Tips for the Military/Veteran Home Buyer: Understanding The Different Types of Home Loans
Compiled by guest “vloggers” Allison Parks and military veteran Kimberly McAleenan of Conscious Real Estate, this is the first installment of a monthly blog series for 2018, providing tips to the military/veteran home buyer. Contact Allison and Kimberly via the Conscious Real Estate website for additional information.
There are many different types of loans just like there are many different types of people. They are not one size fits all. Rather, they are made to fit each person and situation differently. Let’s dive in! In this video, we asked a lender all about the different types of home loans.
Questions to Ask About Types of Home Loans
When deciding which home loan is good for you, there are a few questions to ask yourself:
- What is your credit score?
- What is your ideal maximum home price?
- What are your down payment options?
When it comes to credit score, you can utilize the many free programs to find out your score, or you can contact a lender to get pre-qualified and they will help you with all the steps. Plus, if you are pre-qualified, you will have a much easier time looking for a home. So many people try to look for a home first, then realize they need to get pre-qualified and have no clue what they can afford, if they can afford, what the real estate market looks like, etc. Dreaming about a new home is awesome, but finding out the facts first is pretty crucial.
What are the Types of Home Loans Available?
As a buyer, there are different types of home loans that you may qualify for. VA Loans (and variations of it) are available to certain military personnel and have a zero percent down payment option. USDA loans have an opportunity for a zero percent down payment too.
FHA Loans can help people with financial assistance as they have a 3.5% down payment option. And, there are conventional loans which range from 3% to as much as you would like to put down. Note that these typically have a lower monthly payment than the FHA loans do.
How Does Pre-Approval Work?
As a lender, first we want to see what you’ll qualify for. We look at where your credit score is at, what your ideal maximum house payment is, and what your down payment options are. In many cases, buyers qualify for a few different programs. At that point, your lender will help you decide what is best for your budget, both short term and long term.
Make sure that you have an experienced lender who is objective and also considers your best interest. We recommend consulting with Conscious Real Estate to work through the home buying process. And, we advise making sure if you are using a VA Loan, to use a lender who is familiar with the minute details of the program so that you are able to maximize the benefits granted to you. If you have any other questions about real estate or the home buying process, click here to start a conversation with a realtor. And know that any financial “hurdles” you may have can usually be remedied by choosing the types of home loans that work for your particular situation. Nearly everything can be figured out, so go ahead and talk to a lender. You could be in a home soon with a good team at your side.