Residential mortgage loans come in four primary types. Information regarding these four types of loans is below. Your lender will have much more detail on the loans and the specifics of them. The Terms and Conditions for any loan will vary based on each individual borrowers situation. Debt to Income Ratios, Assets, Income Levels, Credit History and Credit Scores all play a role in determining which program you may be eligible for as well as your interest rate, loan costs and loan approval levels.
Shopping for and selecting a lender early in the home buying process is key to understanding your costs and options when buying a home.
Conventional Loan
Most flexible loan option, can be used for any type of property purchase.
- Minimum FICO Score Typically: 620
- Down Payment: 5% Minimum
(Note: 3% may be available for certain Loan Programs) - Occupancy: Primary, Secondary, Investment
- PMI Required if less than 20% down
- Gift Funds Allowed
- Up to 9% Seller Contributions allowed (depends on LTV)
Conventional loans also come in two different sizes, Conforming -up to $548,250 and Jumbo -amounts over $548,250. Conforming Loan Limits vary by county, so check with your lender.
VA -Veterans Administration
Must be a Veteran to participate in this program.
- Minimum FICO Score Typically 580
- No Down Payment Required, can Finance 100% of Loan
- A VA Funding Fee will be added to your loan Balance, 2.3% – 3.6%
- Occupancy: Primary Residence
- No Monthly Mortgage Insurance
- 100% Gift Funds
- 100% of Veterans Closing Costs & Pre-Paids CAN be paid by Seller, typically No closing costs are paid by seller in this market.
FHA -Federal Housing Admin
A poplular lending option for First Time Home Buyers due to the low down payment. There may be Mortage Insurance required.
- Minimum FICO Score Typically 580, may have DTI (Debt To Income) limits.
- Down Payment: 3.5% Minimum
- Occupancy: Primary
- UFMIP Finance: Monthly MI Required
- 100% Gift Funds
- Up to 6% Seller Contributions
USDA -US Dept of Agriculture
Very rare to see a USDA loan in the Tampa Bay area. Typically used in more rural areas to stimulate development.
- Minimum FICO Score Typically 580
- No Down Payment required
- Occupancy: Primary
- Annual Fee Required, paid monthly
- Up to 6% Seller Contributions
For more information on these loan programs, go to the following web sites:
Conventional Loans: https://www.consumerfinance.gov/owning-a-home/loan-options/conventional-loans/
VA Loans: https://www.va.gov/housing-assistance/home-loans/loan-types/
FHA Loans: https://www.hud.gov/buying/loans
USDA Loans: https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do
