Searching for a home loan in the Irvine, CA area can be extremely intimidating, especially if you are a first-time homebuyer or have a few blemishes on your credit. Even seasoned buyers can be startled by all of the fast talk, terms and conditions, and mountains of paperwork that are often involved with securing home loans. Fortunately, obtaining a loan for your new residence doesn’t have to be as daunting as you might expect. Working with an experienced, reputable lender and familiarizing yourself with the ins and outs of the lending process can help to ensure that your next home loan adventure is a rewarding one.
Types of Home Loans Available
In order to select the best home loan for your unique situation, it is important to understand the various types of loans that are available.
- Conventional Loans: Conventional loans are an excellent choice for many homebuyers. Designed for loan amounts under $417,000, a conventional loan can be obtained with as little as 3% down. With a 55% debt to income ratio, borrowers can qualify for a larger monthly payment as long as they meet the credit requirements.
- FHA Loans: If you have had credit problems in the past, an FHA loan might be a better option for you. FHA loans typically offer lower rates than conventional loans and borrowers can be approved with credit scores as low as 500. Keep in mind, however, that when you take out an FHA loan, mortgage insurance is required for the life of the loan.
- VA Loans: Military service members and their families can experience the American dream more easily when they opt for VA loans. With 100% financing, no down payment required, no mortgage insurance requirement and flexible credit terms, VA Loans are often the best choice for Active Duty Personnel, National Guardsmen and Reservists, Veterans, and even surviving spouses.
- USDA Loans: If you are interested in purchasing a home in a qualifying rural community, you might want to consider a USDA loan. Enjoy more flexible credit requirements, 100% financing, competitive interest rates and low monthly mortgage insurance premiums. USDA loans are designed for homes that are owner occupied.
- Construction Loans: Enjoy the freedom of selecting your own contractor and building plans for your custom built home when you obtain a construction loan. You can choose to secure your permanent financing once your new home is completed, or opt for the One Time Close loan and your construction loan will automatically convert to a long term home loan with no additional costs or signatures required.
- Investment Property Loans: In order to secure an investment property loan you will need to have a good credit score, at least 20% down, and cash reserves available to make the mortgage payment when your property is unoccupied. Borrowers with less favorable credit scores might consider getting an investment partner with a high credit ranking or putting off the loan until credit scores improve.
Lending rates are at an all-time low right now, and many borrowers will decide that this is an excellent time to invest in a home. Deciding on the type of loan that is right for you and obtaining a mortgage, however, can be extremely challenging. A qualified loan professional can answer any questions you might have about the home loan process, help determine which types of loans are available to meet your needs, and provide you with the advice and information you need to ensure that your experience with the American Dream doesn’t become a nightmare.
For more information about how our team of experienced and dedicated loan professionals can be of service to you, give us a call today or fill out our online request form.