While finding the financing package that best suits your needs can be a complicated process, your Crestico Real Estate Agent can help you find the financing method that works for you.
Home financing is available from mortgage companies, savings and loan associations, banks, credit unions and others. Each will have its own rules, rates and fees. When you compare financial institutions, be sure to look for variations in the way mortgages are offered — distinctions that can mean dollars of difference to you. You will want to research the various lenders in your area to see which is the best “fit.”
The number and variety of financing options can seem overwhelming at first, but most fit in one of these main categories. We review some of the different types of loans below. You may also want to use our Mortgage Calculator to help determine the type of loan best suited for you.
Conventional Financing: Conventional mortgages are labeled as such to differentiate them from government-backed loans, such as FHA or VA loans.
Federal Government Programs: Programs sponsored by the Federal Government through the Federal Housing Authority, Veterans Administration or Farmers Home Administration.
Alternative Financing: Various alternative arrangements for home financing made by the buyer that can incorporate elements of Conventional financing programs.
Remember that financing options are affected by local and regional real estate and banking practices and in some areas by state law.
Questions to ask the lender
Before you make your home financing decision, you should be familiar with your options. Questions you should ask of your lender include:
What are the differences between the various types of adjustable-rate loans and fixed rate loans.
Is the mortgage open-ended? Can you borrow up to the amount of principal you’ve paid to make home improvements?
Will mortgage insurance be required for loans other than FHA-insured or VA guaranteed mortgages?
How much principal must be paid before the insurance requirement is dropped? What are the premiums and are the premiums refundable if you prepay the mortgage?
What reserves, such as those for property taxes or hazard insurance, are required? How long must you pay into these reserves? At some point, will you pay these costs directly?
What fees will be charged at closing, including such things as points, loan origination, abstracts, attorney’s fees, appraisals, termite inspection reports or credit reports?