With a purchase loan, you enter a contract to purchase an existing home and complete an application for a mortgage. As your lender, we will go through the process of verifying your income, assets and credit, while also confirming the value of the home through an appraisal.

The money is transferred to the seller at closing.

As the name suggests, a construction loan funds a home that has not yet been completed. After all permits and contracts are approved, we will advance money to the home builder on a set schedule, following each step of the construction process.

After the home is completed, you will pay off a simple construction loan by refinancing it to a regular mortgage loan. Construction-to-permanent loans make this transition automatically.

These loan programs provide funds for both the purchase of the property and costs for repairs, upgrades or expansion. The property’s value is appraised based on the planned improvements.

Purpose:

Purchase or Construction

Requirements:

Available only to veterans or active-duty members of the U.S. Armed Forces

High safety standards for purchased property (such as no peeling paint or missing handrails)

Benefits:*

$0 down payment

No monthly mortgage insurance

Flexibility in qualification (credit scores, cash-on-hand)

Higher maximum loan amounts

Higher debt to income ratios

*Benefits vary based on service history and eligibility.

Allowances:

Financing available for eligible closing costs

Can be assumed by another approved veteran. In this scenario, the buyer takes over the existing loan from the seller, accepting the same terms and paying the difference between the loan balance and the purchase price. The difference can be financed with a second loan.

Sponsor: U.S. Department of Veterans Affairs (VA)

Purpose:

Purchase, Purchase and Rehab, Construction

Requirements:

Must fall in an area designated as “rural” by the USDA, as shown in this property eligibility map

Maximum loan limits dependent on area

Owner-occupancy required

Cannot be income-producing

Income up to 115% of the area median income

Benefits:

$0 down payment

Flexible credit eligibility

Reduced mortgage insurance

Allowances:

Financing available for eligible closing costs

Gift money, grant money and seller contributions allowed

Sponsor: United States Department of Agriculture (USDA)

Purpose:

Purchase or Purchase and Rehab (FHA 203K Program)

Requirements:

Mortgage insurance required for life of loan

Maximum loan limits dependent on area

Benefits:

Credit and qualification flexibility

3.5% down payment

Higher maximum loan amounts than Federal Housing Finance Authority (FHFA) conforming limits in some areas

Allowances:

Seller contributions and gift money allowed

Sponsor: Federal Housing Administration (FHA)

Purpose:

Purchase, Purchase and Rehab, Construction

Requirements:

Maximum conforming loan limits set by the Federal Housing Finance Authority (FHFA)

Benefits:

Down payments as low as 3%

Fixed rate and adjustable rate mortgages available

Available for 1-4 family property and primary occupancy, secondary occupancy or investment

Mortgage insurance required only while loan is more than 80% of the home’s value

Allowances:

Seller contributions and gift money allowed

Sponsor:

Fannie Mae; Freddie Mac; private lenders including independent banks, credit unions or other mortgage lenders

Special Conventional Programs:

Fannie Mae Homestyle Renovation Loan

Purpose:

Purchase and Rehab

Requirements:

Maximum conforming loan limits set by the Federal Housing Finance Authority (FHFA)

Benefits:

Purchase and cost of renovation combined into one loan

Renovation can be simple refresh (paint and flooring), major repairs or luxury upgrades

Flexibility of a conventional loan

Cancellable mortgage insurance

Allowances:

Seller contributions and gift money allowed

Sponsor:

Fannie Mae

Fannie Mae HomeReady

Purpose:

Purchase

Requirements:

Maximum conforming loan limits set by the Federal Housing Finance Authority (FHFA)

Homeowner education program

Income 80% or lower than area’s median income

Primary Residence

Benefits:

3% down payment

Higher debt-to-income ratios

Flexible credit eligibility

Flexibility of a conventional loan

Cancellable mortgage insurance

Allowances:

Seller contributions, grants and gift money

Non-occupant co-borrowers

Rental property payments considered as income

Sponsor:

Fannie Mae

Freddie Mac Home Possible

Purpose:

Purchase

Requirements:

First time home buyer (at least one borrower)

Income 80% or lower than area’s median income

Benefits:

3% down payment

Flexibility of a conventional loan

Cancellable mortgage insurance

Allowances:

Non-occupant co-borrowers

Mulitple available down payment sources, including family, employer-assistance, secondary financing and sweat equity

Sponsor: Freddie Mac

Purpose:

Purchase or Purchase and Rehab

Requirements:

Owner occupancy

Benefits:

5% down payment for 2- to 4-unit properties

Allowances:

Program dependent (conventional, HomeReady or HomeStyle Renovation)

Sponsor: Fannie Mae

Purpose:

Purchase, Purchase and Rehab, Construction

Requirements:

Must fall within allowable loan and down payment amounts

Benefits:

Loan limits beyond those placed by the government-sponsored agencies

Down payments as low as 5%, but typically higher with greater loan amounts

Fixed rate and adjustable rate available

Any type of residential property and occupancy

Cancellable mortgage insurance

Allowances:

Seller contributions and give money allowed

Sponsor:

Private lenders including independent banks, credit unions or other mortgage lenders