Understanding Minnesota Mortgages
- FHA loans: An FHA loan is a mortgage issued by federally qualified lenders and insured by the Federal Housing Administration (FHA). FHA loans are designed for low-to-moderate income borrowers who are unable to make a large down payment.
- First-time homebuyer programs: FHA loans help first–time buyers purchase homes by offering government insured loans with more lenient qualifying guidelines such as lower down payment requirements. If you qualify for an FHA loan, you may be able to put as little as 3.5% down*, as well as use gift funds to pay for the reduced down payment amount. Usually need at least a 640 credit score.
- Fixed-rate mortgages: A fixed–rate mortgage (FRM), often referred to as a “vanilla wafer” mortgage loan, is a fully amortizing mortgage loan where the interest rate on the note remains the same through the term of the loan, as opposed to loans where the interest rate may adjust or “float”.
- Minnesota housing and other community bond mortgages: State and local governments sell tax-exempt Housing Bonds, commonly known as Mortgage RevenueBonds (MRBs) and Multifamily Housing Bonds, and use the proceeds to finance low-cost mortgages for lower income first-time homebuyers or the production of apartments at rents affordable to lower income families. A Community Bond can only be offered by non-profits or charities. A Community Bond is an interest-bearing loan that allows participants to align their investments with their values, while enjoying a stable return. The bond is secured against the value of the asset (in our case, a building).
- Reverse mortgages: a financial agreement in which a homeowner relinquishes equity in their home in exchange for regular payments, typically to supplement retirement income. “unlike traditional mortgages, which decline as you pay down the loan, reverse mortgages rise over time as interest on the loan accrues”
- Second-home mortgages (lake homes and recreational properties): A second home is a residence that you intend to occupy in addition to a primary residence for part of the year. Typically, a second home is used as a vacation home, though it could also be a property that you visit on a regular basis, such as a condo in a city where you frequently conduct business.
- Home refinancing: Getting a new mortgage to replace the original is called refinancing. Refinancing is done to allow a borrower to obtain a better interest term and rate. The first loan is paid off, allowing the second loan to be created, instead of simply making a new mortgage and throwing out the original mortgage.
- Investment property mortgages: Investment propertyis real estate property that has been purchased with the intention of earning a return on the investment, either through rental income, the future resale of the property or both.
- VA loans: A VA loan is a mortgage loan in the United States guaranteed by the United States Department of Veterans Affairs (VA). … The loan may be issued by qualified lenders.
- Adjustable rate mortgages (ARMs): A variable-rate mortgage, adjustable–rate mortgage (ARM), or tracker mortgage is amortgage loan with the interest rate on the note periodically adjusted based on an index which reflects the cost to the lender of borrowing on the credit markets. The loan may be offered at the lender’s standard variable rate/base rate.
- Mortgages for people with less-than-perfect credit: Check with one of our Preferred Lenders for guidance on the best option for you. (See the below listed)
Hudson Murphy with Wintrust Mortgage (651)-276-2349
Scott Perron with Cambria Mortgage (612)-554-1932
Randy Emerson with Guaranteed Rate (612)-801-1300
- USDA home loan: A USDA home loan is a zero down payment mortgage for eligible rural and suburban homebuyers. USDA loans are issued through the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, by the United States Department of Agriculture.
This is just to give you an idea of options. Thanks for visiting our BLOG! Please come back next week for more great information from 4 Sale Real Estate and sister company Fieldstone Family Homes, Inc.