Mortgage rates are still historically low, making it a great time to buy! Find out what the current rates are and what mortgage loans are available!
Mortgage Loans
Conventional/Fixed Rate: These are a good choice because your monthly payment is consistent. These types of loans come in 10, 15, 20, 30 and 40 year terms but 15 and 30 are the most popular.
Interest Only: These loans give you the option during the first 5 or 10 years of the loan to pay only the interest of your monthly mortgage payment instead of the full payment. This does cause your loan to be paid off slower but it can be helpful if money is tight. After that initial period, the loan is paid off just like a traditional mortgage.
Adjustable Rate Mortgage (ARM): There are several different types, but a common one is the 5/1, where the interest rate is the same for the first 5 years and then can change the last 25 years of the loan. This may be a good option for you if you aren’t planning on staying in a home for too long.
FHA: These loans are guaranteed by the Federal Housing Administration. These loans are equipped with mortgage insurance in case the loan is not able to be paid back. The plus side to these loans is the down payment required is smaller. If you are unable to put 20% down, these loans are worth checking into.
VHA: These are loans available for veterans; there is no down payment required and these loans are backed by the Department of Veteran Affairs.
Less Common Mortgage Loans
Piggyback/Combo: This is when you have a down payment of less than 20% and then you have two loans of any kind so that you don’t need to pay private mortgage insurance.
Balloon: For this type of loan, only the interest is paid at first and then after that the total principal amount is due.
Jumbo: This is a mortgage that is considered too large for the Federal government to buy or guarantee.
Current Mortgage Rates
Rates are still low, making it a great time to buy a home. Check out some current rates below!
Conventional 30 Year Fixed: 3.75
Conventional 15 Year Fixed: 3.375
Conventional 5 Year ARM: 4.438
For more rates and for information on getting pre-approved, I recommend contacting AJ Rossi from First State Mortgage (815) 768-3032.