What Types of Mortgages Are There?

What Types of Mortgages Are There?

What Types of Mortgages Are There?

There are a multitude of mortgage types currently   available, though most mortgages fall into one of three categories: Conventional, VA or FHA.
Conventional mortgages are the most common and most flexible and are not insured or guaranteed by any government entity. Down payments typically range from 3% to as much as desired. However, there are 0% down payment options available. Typically, mortgage insurance (non-government) is required for conventional loans with down payments less than 20%.
However, alternative options are available that provide loans without mortgage insurance even with very low down payments. Loan officers can help you decide which type of loan works best for you.
VA loans are guaranteed by the Veterans Administration and are available to qualified veterans. The primary benefit of a VA loan is the ability to obtain   100% financing. The veteran pays a funding fee to the VA at closing, and the fee may be included in the loan. The funding fee varies from 0% to 3% of the loan amount, depending on a variety of factors.
FHA (Federal Housing Administration) loans require very low down payments and   are insured by the FHA. A one-time premium is paid at closing and a small monthly premium is included in the loan payment. The amount of the up-front and monthly premium varies with the term of the loan and the loan-to-value ratio.

This information is not to be used as investment advice, but for informational purposes only. Republic Bank & Trust Company prohibits the dissemination, distribution or copying of this document without the Bank's prior written consent. Please consult your financial or tax advisor for further information. Member FDIC.