It’s Time for a Mortgage, But Which One Should You Choose?

Mortgage Rates in Salt Lake CityHome ownership will bring pride, joy, and fulfillment to anyone. However, not everyone can easily become a homeowner, with what the great number of factors one has to meet in order to purchase a home. Thanks to financing services, including companies that offer reasonable and even affordable mortgage rates in Salt Lake City, American Loans claims you now have higher chances of securing a home loan.

Keep in mind, though, that not all types of loans suit everyone’s needs and preferences, so make sure you take the time to learn more about your options. The type of mortgage most appropriate to your needs and wants will depend on several factors, so knowing more about them will help you make the wisest decision.

Traditional loans

Conforming or non-conforming loans are the most common types of traditional loans available to Utah home buyers. However, these are most suitable for borrowers who have a good financial standing, credit history, and FICO score.

When you want to purchase a home with an above-average price, and you have enough for at least a 20 per cent down payment, then a traditional loan makes sense. This will save you money in the long run, since making this kind of down payment will no longer require you to purchase the pricey mortgage insurance.

Federal Housing Administration (FHA) loans

When you cannot make the 20 per cent down payment, consider applying for an FHA loan – a government-backed mortgage. With this type of loan, you only need to put down at least 3.5 per cent as your down payment. Plus, it has less rigorous rules and requirements, which is why many Salt Lake City home buyers opt for it. Even borrowers who have a poor credit score can secure this type of mortgage.

Veterans Affairs (VA) loans

Have you served in the military? Then you should consider going for a VA loan, another government-backed loan specifically designed for those who were or are still in service. You still need to meet certain qualifications, but they are not as strict compared with other types of mortgages. You can even qualify for complete financing, meaning you do not have to make any down payment.

As a final reminder, always take into consideration your future, so that you can choose the most appropriate mortgage type for your long-term needs and wants.