First Time Homebuyer Resources – The Mortgage

A mortgage is a loan from a bank or private lender that allows you to purchase a home with the bank or lenders money and repay the bank or lender over a set period of time, usually 15 or 30 years. There are 3 main loan types: Conventional, FHA and VA. Let’s go over the differences:

Conventional Loan

A conventional loan is offered through a private lender. Conventional loans require a higher credit score, typically gets you a lower interest rate and requires you to put down 20% on a home.

FHA Loan

An FHA loan is a federally backed loan. FHA stands for Federal Housing Administration. Since FHA loans are funded through the government, your credit score can be lower but your interest rate will be higher. For FHA loans, you only have to put 3.5% down on a home.

VA Loan

A VA loan is offered is also a federally backed loan. VA stands for Veterans Benefit Administration. VA loans are for active duty and retired military only. They cover 10% of the home cost, meaning no money down. However, because the government is agreeing to back the loan completely, the. requirements on the condition of the home are stricter. You will need to have a certified VA lender to assist in the loan process, and they will have all of the specific requirements laid out for you. 

Getting Pre-Approved

Getting pre-approved before starting your home search is important so that you know how much you can afford. The lender will also have information that might help you get a better interest rate based on things you can do to improve your credit score. We have a list of trusted lenders for all loan types.

Next Steps

If you’re considering starting your home search, reach out to us for more information and to be connected with a lender that fits your needs. Email us at info@teibertandassociates.com.

Check out the resources below for more information on how a loan works, as well as mortgage calculators and affordability calculators to help you see how much you may be able to afford with preliminary information you may already have.