For some, owning a home can be a pipe dream. It can be prohibitively expensive for those who are just starting their professional careers or at entry-level jobs. A lot would rely on mortgage lenders who can help finance their future homes. A few of them can still be pricey, but there are other programs you can choose from. There should be one for every type of person, whether they are earning a high salary or not. Here are some that are great for the budget-conscious.
30-Year Fixed-Rate Mortgage
At first glance, 30 years would seem like a long time. But if you want to have your own property, a fixed-rate mortgage of this length is something you should also consider. As with most of the loans with this length, it features a fairly affordable monthly payment. You will have to start with a downpayment that is about 3.5% of the total cost of the house. Interest rates for this loan are much higher than those with shorter terms, reaching up to 4%. This is ideal for younger professionals who want to secure a home for their future family.
Aside from banks, the government is another institution that provides some form of financial assistance. For those in the lower-income bracket, they can apply for the Federal Housing Administration or FHA mortgage. This does not require applicants to have a very high credit score and the upfront premium of 1.75% can be paid in cash upon closing the deal or you can have it integrated to the loan itself, thereby increasing your borrowed amount. You can go to your nearest bank and see if they are accredited by the FHA to provide this mortgage.
The USDA mortgage is another government-back financing program for those who cannot seem to get approved for other types of mortgages. This is closely tied with the United States Department of Agriculture, and it targets the rural and suburban areas around the country. Borrowers will love that this basically is not asking for any downpayment. Just send your application and get approved, and you should be all set.
The VA mortgage is a type of financial assistance spearheaded by the US Department of Veteran Affairs. As the name implies, this is a program that military personnel can take advantage of. Eligible individuals include active and retired servicemen. For those who have passed on, their widows could also apply for this loan. What is great about VA mortgage is the government becomes your guarantor in case your account gets defaulted. This is good news for the borrower and the bank, as it eases the pressure of monetary obligation for a bit.
There are traditional loan programs, but if those are still out of your reach, you can check out the loans mentioned above. Do not lose hope if your applications get rejected, as these mortgages are easier to get into. So go ahead and pursue getting your own home, because there should be an option for you out there. Everyone deserves to have one without having to go through various hoops or reach lofty requirements.
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