<\/span>1. FHA Loan<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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A typical home loan requires a down payment of 20% of the purchase price of the home, with a Federal Housing Administration, or FHA loan, the borrower can put down as little as 3.5%. <\/p>

Because Federal Housing Administration loans are government-backed loans.<\/p>\n

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Homebuyers who have very little savings for a down payment can take advantage of an FHA loan. <\/p>

There are several requirements for mortgage loans by FHA. The loan amounts are limited and don\u2019t provide much flexibility. <\/p>

FHA loans are fixed-rate mortgages, with 15 or 30-year terms. <\/p>

Buyers of FHA-approved loans also require paying mortgage insurance, which can be approximately 1% of the cost of their loan amount.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>2.VA Loan:<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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If the borrower had served in the United States military, a VA loan can be an excellent choice over a conventional loan. <\/p>

If they qualify for a VA loan, they can get a home with no requirement of down payment or mortgage.<\/p>\n

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Veterans who\u2019ve served 90 continuous days during wartime, 180 days during peace, or six years in the reserves are eligible for VA loans. <\/p>

As these loans are government-backed, they have strict requirements. <\/p>

The home must be a primary residence and must meet minimum property requirements.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>3. USDA Loan:<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The USDA Rural Development loan is another government-sponsored home loan that is designed for families living in rural areas. 100% of the home price is financed by the government for USDA-eligible homes. <\/p>

Meaning borrowers do not need to make down payments and gain to get the best mortgage interest rates.<\/p>\n

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Financially challenged borrowers in rural areas can access USDA-eligible home loans. <\/p>

These home loans come with affordable mortgage payments. The borrower’s debt load cannot exceed their income by more than 41%, and, borrowers also need to purchase mortgage insurance.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>4. Fixed-Rate Loan:<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The fixed-rate loan – are the most common type of conventional loan, they have a single interest rate and monthly payment for the life of the loan, which is for 15 or 30 years. A jumbo loan is a\u00a0 type of fixed-rate mortgage.<\/p>

This conventional loan is ideal for homeowners who want predictability and want to stay in the home for long.\u00a0<\/p>

For a mortgage payment, the borrower pays a particular amount for 15 or 30 years. A fixed-rate loan requires a down payment.\u00a0<\/p>

The rise and fall of interest rates do not affect the terms of their home loan, so they will always know what to expect with their monthly payment.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>5. Adjustable-Rate Mortgage:<\/span><\/h4>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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The next type of conventional loan is adjustable-rate mortgages (ARM) which offer mortgage interest rates lower than what a fixed-rate mortgage offers for a period of time, like five or 10 years, instead of the life of a loan. <\/p>

And after the initial period, the interest rates and monthly payments get adjusted once a year. <\/p>

So if interest rates go up, the monthly payments too will; if they drop, the borrower will pay less on mortgage payments.<\/p>\n

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Homebuyers with lower credit scores can take advantage of the adjustable-rate mortgage. <\/p>

As people with poor credit do not get good rates on fixed-rate loans, an adjustable-rate mortgage can help to bring those interest rates down and bring homeownership within reach. <\/p>

People who plan to move and sell their home before their fixed-rate period is up and their rates start wavering. However, the monthly payment can fluctuate.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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<\/span>Conclusion<\/span><\/h2>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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A loan secured by real property used for an individual residence or dwelling.  The loan is secured by a lien on the property; the borrowers pay it off over a specified period of time.<\/p>

The interest on a residential mortgage is tax-deductible under most circumstances.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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\n\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\tClick to Get Today's Best Mortgage Rates<\/span>\n\t\t\t\t\t<\/span>\n\t\t\t\t\t<\/a>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Introduction To Residential Mortgage A loan that people get in order to buy a house or other residential property in which they will live is called a residential mortgage.\u00a0 The loan is fixed by a… Continue Reading A Guide To Residential Mortgage And 5 Different Types Of It<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":12223,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[38],"tags":[47,2119,89,2118,2116,2117,2115],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/www.compareclosing.com\/blog\/wp-content\/uploads\/2021\/11\/A-Guide-To-Residential-Mortgage-And-5-Different-Type-Of-It.jpg","_links":{"self":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/12202"}],"collection":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/comments?post=12202"}],"version-history":[{"count":5,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/12202\/revisions"}],"predecessor-version":[{"id":12248,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/posts\/12202\/revisions\/12248"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/media\/12223"}],"wp:attachment":[{"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/media?parent=12202"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/categories?post=12202"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.compareclosing.com\/blog\/wp-json\/wp\/v2\/tags?post=12202"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}