First Time Home Buyer

A first-time homebuyer is defined as someone who has not owned a home in the past three years. This definition applies to FHA, VA, USDA, and Conventional financing.

Bright Living Room
 
Suburban House

VA Home Loan

VA loans are ideal for Veteran home buyers since it does not require a down payment for standard loan amounts ($417,000 and below), but you must be a qualifying Veteran of the United States Military.

An upfront VA Funding Fee is required for most loans, but this fee can generally be included in the loan amount. VA will allow multiple loans for a single borrower so long as the borrower has sufficient entitlement.

A portion of the borrower’s available entitlement is deducted for any available VA loan or defaulted loan. Lack of sufficient entitlement does not disqualify the veteran but will instead require a down payment.

 

USDA Home Loan

USDSA loans allow buyers with a lower-than-average income to buy homes in qualified rural areas with no money down. USDA does require an upfront fee, which can be included in the loan amount.

USDA will also require a monthly guarantee fee, which is similar to mortgage insurance on conventional financing. This monthly amount is included in your monthly payment.

USDA will not lend to borrowers owning another real estate except in the case of a qualifying relocation.

Cozy Living Room
 
French Doors

FHA Home Loan

FHA programs allow for lower down payments when compared to standard conventional financing. FHA also allows an immediate family member to gift the buyer their down payment and closing cost funds.

 

Arizona also offers grants to home buyers who want to utilize the FHA program. FHA does require an upfront fee which is included in the loan amount as well as a monthly mortgage insurance fee that is included in the monthly payment.

 

FHA in most instances will limit any person to 1 loan open at a time.

 

Relocating Buyer-

The Relocation Mortgage Program

FHA & USDA will consider extending their eligibility guidelines if the borrower is relocating and re-establishing residency in another area outside a reasonable commuting distance from the current principal residence.

LHM Financial considers a reasonable commuting distance to be 100 miles or more. An example would be from Phoenix/Metro area to Prescott.

Desert Road
 
Key in the Lock

Conforming Loan

Conforming loans, sometimes called Conventional Loans, are loans that either Fannie Mae (A.K.A. Federal National Mortgage Association) or Freddie Mac (A.K.A. Federal Home Loan Mortgage Corporation), which are the two largest mortgage companies in the U.S.A. 

These programs offer a broad array of down payment options from as little to 3% down and offer financing for second homes and investment properties in addition to owner occupied home loans.


A monthly mortgage insurance premium is required on all conforming loans when the Loan-To-Value ratio is more significant than 80.0%.

However, unlike some other programs, mortgage insurance can be removed when the loan reaches certain milestones. A person can obtain as many as ten conforming loans at one time.

 

Jumbo Home Loan

The definition of Jumbo Loan is one that exceeds Conforming Loan limits. A Jumbo Loan is one way to buy a luxury home or a high-valued home. Borrowers are required to have a low debt-to-income ratio and a high credit score.

 

If you're considering buying a high-value or luxury home, a Jumbo Loan may be right for you.

Interior Decor
 
Home Decor

Manufactured Home

Financing can be challenging for any homeowner. This could be especially true when it comes to mobile homes and some manufactured homes. Manufacture home loans aren't as plentiful as standard home loans. These are government-backed loan programs can make it easier to qualify and keep costs low.

When it comes time for you to purchase a manufactured home, deciding on how you want to finance is a top priority. LHM Will help you compare the types of loans that are available can help you make a decision.

 

Home Equity Loan

A home equity loan may also be referred to as a second mortgage, which allows you to borrow a lump sum against your current home equity for a fixed rate over a specified period. Many home equity loans are used to finance large expenditures, which could be used to do home repairs or pay college tuition.

A home equity line of credit (HELOC) is a revolving line of credit, usually with an adjustable interest rate, which allows you to borrow up to a certain amount over some time. HELOCs work like credit cards, where you can continuously borrow up to an approved limit while paying off the balance.

Modern Living Space
 
Modern Living Room

Reverse Mortgage

Designed to help homeowners 62-years and older, this loan allows you to use the equity in your home to supplement your retirement income.

 

The available proceeds can be used to pay off your current mortgage, thereby eliminating your monthly mortgage payment; provide a monthly income for a certain time period, or for as long as you live in your home; or, to set up a Line of Credit for future use, as you wish, with the amount available increasing at a rate guaranteed by the US government – all without paying taxes on the proceeds received (it is a return of your equity).

 

It is a fairly complex financial planning tool, so be sure to work with someone who thoroughly understands the product and can answer all your questions. LHM Financial can help.