Buyers - Financing Types





Financing Preapproval Finding a lender How much can I afford? Types of Financing


Types of Financing
While there are a multitude of financing options on the market today most home purchases are made using FHA, VA or Conventional Financing. Other types of financing such as seller financed contracts are used occasionally along with a different type of financing for new construction.
	FHA FHA financing normally requires lower down payments, lower closing costs and is often easier for buyers to qualify for. The FHA acts as insurers for the loan, allowing lenders a bit more freedom.
	VA For qualified Veterans lenders are able to offer VA financing. Qualified buyers often will find low or no down payment requirements and often find it easier to qualify. If you are a Veteran talk to a lender about VA financing.

		For more information FHA Veterans Administration
	Conventional Almost all other types of financing fall under the Conventional category. While there are a wide variety of Conventional types including ARM (Adjustable Rate Mortgage), Fixed or Balloon they are all typically insured by the lenders and usually require larger down payments. They often have more stringent requirements for qualifying however, interest rates can be lower under certain conditions.	For more information FHA Veterans Administration

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	Seller Financed Though seldom used in the sale of a home, seller carried contracts are still used sometimes in the sale of parcels of land. Typically these types of transactions are drawn up by an attorney experienced in real estate transactions.

	New Construction Financing the construction of a new home is handled differently than financing an existing dwelling. Typically the lender provides the builder with a line of credit to cover the cost of labor and material. Once the structure is completed and the lender has all necessary documentation in hand, they issue a mortgage on the completed home.

Working with a good lender along with an experienced agent will help you more fully understand what type of financing is best for you. Contact your agent if you have more questions about what type of financing will be best for you.

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