Will you be home for Christmas? Rocky Mountain Credit Union can help you find the perfect place to trim your tree and deck the halls. If you're in the market for a new home, we can help. Our team of real estate lending experts is on call to work with you to find the right loan that best meets your needs.
With so many mortgage options out there, it can seem a little mystifying when you're just starting out. It's good to know what you can expect as you begin your home buying journey. Here's the info behind the terminology to get you started.
A government agency doesn't back a traditional loan. The advantage of putting 20% of the value of your home down is that you can avoid paying mortgage insurance with a conventional loan.
The Federal Housing Finance Agency (FHFA) sets a conforming-loan limit, which is in the form of a dollar amount. A conforming loan is one that comes in under or meets that limit. They also have to meet specific funding criteria set by Fannie Mae and Freddy Mac, which also insures them. Lenders frequently work with this type of loan since a variety of people do not qualify for traditional financing. Conforming loans often find difficulty in deals where cash buyers or bidding wars ensue.
It follows then that non-conforming loans don't meet the standards that conforming loans do. Opting for this option lets you buy a house at a higher value than the limit, or one that doesn't meet all of the criteria for a conforming loan, but it will cost more.
Like its name implies, a jumbo loan is a type of non-conforming loan that lets you go for a higher home price. This is for buyers looking at higher value properties that don't fit traditional loan numbers. In Montana, a Jumbo loan is one that finances over $510,000 as a mortgage. It requires 20% equity and is investor-backed, so sometimes you can negotiate closing costs and interest terms with the lender.
The federal government has several programs to help homebuyers out. The good news is, you can often qualify with a lower down payment too.
Federal Housing Administration (FHA) Loans
An FHA loan can be a great place to start if your finances don't allow you to make a significant down payment on a house, but you're exploring the options. These are designed for buyers with low-to-moderate income and possibly lower credit.
Veterans Administration (VA) Loans
VA loans are an avenue available to servicemembers, veterans, and spouses as long as they're not remarried. They're issued by lenders that are qualified, and the US Department of Veteran Affairs insures them. These are an excellent option for qualifying buyers, since they require $0 down.
Rural Development (RD) Loans
For rural and suburban homebuyers, a rural development loan offers a chance to put $0 down if they qualify. What could be better for a homebuyer in Montana? The USDA Loan Program guarantees them.
Beyond the basics, there are some special programs in place too. Contact one of our mortgage specialists for more information about these programs.
Butte and Helena - Nicki Jemmings - 406.447.1109
Belgrade and Bozeman - 406.582.6624
Bozeman - Kalene Mangini and Peter Morgan - 406.582.6628
There's snow place like home for the holidays. We would love to talk more about your mortgage needs. With a variety of available lending products, we can assist you from planning to closing and everything in between. Click the banner below to get started today or click here for more specifics.
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