A home where you can bring it all.
Conventional
Down payment: Conventional loans usually require a down payment of at least 3% to 20% of the home's purchase price, depending on the lender and borrower's financial situation.
Private Mortgage Insurance (PMI): If the down payment is less than 20%, borrowers may need to pay for PMI to protect the lender in case of default. However, once the loan-to-value ratio reaches 80%, PMI can be canceled.
Flexibility: Conventional loans offer more flexibility in terms of property types and usage. They can be used for primary residences, second homes, and investment properties.
No upfront funding fee: Unlike some government-backed loans, conventional loans do not require an upfront funding fee, which can save borrowers money at closing.
Faster processing: Conventional loans often have faster processing times compared to government-backed loans, as they typically involve fewer bureaucratic steps.
FHA
Lower down payment: FHA loans require a minimum down payment of 3.5% of the home's purchase price, which can be a more affordable option for borrowers who don't have a large amount of savings.
Lower credit score requirements: FHA loans generally have more lenient credit score requirements compared to conventional loans. Borrowers with a credit score as low as 500 can qualify with a 10% down payment, while a minimum score of 580 is typically required for a 3.5% down payment.
Flexible income sources: FHA loans consider various sources of income, such as part-time jobs, overtime, bonuses, and even non-employment income like alimony or child support, which can help borrowers qualify.
Closing cost assistance: FHA loans allow the seller, lender, or even a family member to contribute towards the borrower's closing costs, making it easier for buyers to afford the upfront expenses.
Home Ready
Low down payment: HomeReady loans offer a low down payment option, with as little as 3% of the home's purchase price required, making homeownership more accessible for buyers with limited funds.
Lower credit score requirements: HomeReady loans may accept lower credit scores compared to traditional conventional loans, allowing borrowers with slightly lower credit scores to still be eligible for financing.
Flexible property options: HomeReady loans can be used for a variety of property types, including single-family homes, townhouses, and certain manufactured homes, providing flexibility for borrowers looking to purchase different types of properties.
Non-occupant borrowers: HomeReady loans allow income from non-occupant borrowers, such as parents or relatives, to be considered when qualifying for the loan, which can be helpful for buyers who need additional income support.