Helpful Guide to Lee’s Summit Home Loans
When considering the numerous Lee’s Summit home loans that are offered, homebuyers may become overwhelmed. Financing is the single-most important aspect of the home buying process. Choosing the right program can make the loan approval process easier. Borrowers may also save a significant amount of money over the course of the loan. It makes sense to narrow down your options and identify the best solution for your situation. The ideal way to accomplish this task is to have a good understanding of the major types of mortgages.
Conventional mortgages are popular among buyers who have adequate funds for a down payment and an excellent credit background. This is one of the most sought after Lee’s Summit home loans on the market.
- Fixed and adjustable-rate mortgages.
- Not backed by the federal government.
- Rates are typically higher than the FHA program.
- Interest rate is based on the prime interest rate and your credit score.
- Basic terms and conditions for conforming conventional financing meet the guidelines of Fannie Mae and Freddie Mac.
- A good credit score and stable work history are necessary.
FHA loans are insured by the Federal Housing Administration. The program generally offers an easier application process and flexible underwriting guidelines for homebuyers.
- All income levels may apply.
- Down payment of at least 3.5% of the home’s purchase price is required.
- Finance terms include: 30-YR and 15-YR fixed-rates and adjustable-rate options.
- Use for primary residences only.
- Gift funds can be applied towards a down payment and closing costs.
- No penalties for prepayment.
- Borrowers may have to pay an upfront mortgage insurance premium and a monthly fee.
The U.S. government insures USDA loans to promote homeownership in smaller communities. This type of Lee’s Summit home loans can be used to finance single-family and multi-family houses.
- Great option for people who want to move into the country or just outside a city.
- Property must be in an USDA designated area.
- 30-YR fixed-rate terms only.
- Mortgage insurance is not required.
- Income limits vary, depending on the borrower’s location.
- Household income may not exceed 115% of the area’s median income.
- 100% financing is offered.
- Property must be owner-occupied.
- Closing costs can be paid for with gift funds.
VA loans are available to those who have served or are currently serving in the U.S. military. This program is also open to qualified reservists and in some cases, surviving spouses.
- Funded by the Veterans Administration.
- Must have a good credit record and decent income.
- The property must be a primary residence.
- Closing costs are similar or less than other financing choices.
- No prepayment penalties.
- Low to no down payment.
- One-time funding fee is usually required.
- Closing costs can come from gift funds or grants.
- Monthly mortgage insurance is not mandatory.
If you do not meet any of the standards stated above, ask your lender what you can do to improve your chances of owning a home in the future.
Need more information on Lee’s Summit home loans? Contact Cornerstone Mortgage, Inc. online or call 816-525-9910 to get started today! Their highly experienced team of loan officers can help determine the best mortgage for you.