At Disney Financial, we specialize in a variety of mortgages. Here are several of our most popular options.
A conventional loan is underwritten and originated by a private lender but insured by Fannie Mae or Freddie Mac, which are the government agencies that regulate the mortgage lending industry. Compared to other mortgages, conventional loans come with lower interest rates. While a 20% down payment is required to avoid private mortgage insurance (PMI), you may be able to get a conventional loan with as little as 3% down. Typically, a credit score of at least 620 is preferred.
Backed by the Federal Housing Administration (FHA), the FHA loan was created to help borrowers who may be underqualified for conventional financing due to credit-challenges and/or down payment limitations.
If you have a credit score of at least 580, you may be able to lock in an FHA loan with as little as 3.5% down. But if you have a down payment of at least 10%, a score of 500 is acceptable. FHA loans do come with two mortgage insurance premiums: one which you’ll pay upfront and another that will be due monthly for the entire life of the loan.
If you’re an active-duty or veteran military member or an eligible spouse, a VA loan might make sense. With a VA loan, you don’t need to come up with a down payment and won’t be required to pay mortgage insurance. You will, however, pay an upfront funding fee, which will be a percentage of the total loan amount.
The percentage charged will depend on your down payment amount and whether or not you’ve used your VA privileges for a home loan before. Note that if you’re a veteran with VA-approved disabilities related to your military service, the funding fee may be waived.
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