Common Types of Home Loans
Fixed-rate mortgages Fixed rate mortgages are mortgages where the interest rate stays the same for the entire term of the loan, commonly amortized over 30 years.
Adjustable-Rate Mortgages With an adjustable rate mortgage, the rate of the loan can change throughout the term of the loan. The rate of the loan is based on adding points to a fixed base.
Hybrid loans A hybrid loan combines a fixed period along with an adjustable component. Usually these loans are fixed for a period of time and then the loan becomes adjustable where it is dependant on current rates. Typical examples are 5/1 or 7/1 ARM's, with a fixed rate for the first five or seven years.
FHA Loans An FHA loan is insured by the Federal Housing Administration with a minimum of 3.5% down payment.
VA Loans A VA loan is guaranteed by the Veterans Administration with as little as 0% down payment. The loan may be issued by qualified lenders. The VA was designed to offer long-term financing to American Veterans or to their surviving spouses.
