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Albert Garcia Team | Home Loans

Home Loans 

What is a Home Loan?

A Home Loan, also known as a loan agreement, enables a homebuyer to finance their home. The loan agreement is a promise to repay the loan taken out to purchase the house or property. At the end of the process, the property is released from the agreement, meaning the loan is paid off and belongs to the buyer in full.

Whether you’re a first-time homebuyer or looking to buy a second property, there are many home loan options to gain financing depending on your qualifications or situation. For those buying their first home, you are eligible for first time homebuyer credit courtesy of Albert Garcia Team. The two major home loan options are: FHA mortgages and Conventional mortgages.

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FHA Mortgages  vs Conventional Mortgages.

FHA mortgages:

FHA mortgages (Federal Housing Administration) are government-backed mortgage programs created in the 1930s with the goal of allowing ownership to more Americans, as an economic stimulus and as a tool of economic stability.

FHA Mortgages Features:

  • Down payment as low as 3.5%
  • Available for individuals with a credit score of 580 [+]
  • No penalties for prepayment.
  • Seller closing cost contribution up to 6%
  • Higher debt to income allowed, making it easier to qualify. 

Conventional mortgages are mortgages executed by regular banks or a direct lender.

Characteristics of conventional mortgages:
  • Requires credit score above 620 points
  • It has more flexible terms such as a fixed or adjustable interest rate.
  • It is not mandatory to take out mortgage insurance.
  • More competitive interest rates.

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What conditions are required to be met in order to get a mortgage?

  1. -Income reliability: The ability to generate sufficient income must be demonstrated to cover payment commitments of the purchase process.
  2. -Credit: Credit is another important element; however, you can get a mortgage loan with poor credit score; however this will have an impact on the interest rate.
  3. -Capital: A down payment will always be required for a hypothetical loan. This first payment can also have an impact on the monthly fee. In addition, closing costs must be taken into account.
  4. -Collateral: The collateral is the property itself, so it is important that you are able to have an offer accepted by the seller to prove the existence of a property.

    First time home buyer credit exists for eligible homebuyers allowing them to apply this credit towards title services. Among the benefits, there are various home loans that exist to assist homebuyers on the greatest financial investment of their lives.

Other programs available and that can apply:

VA Program: Program applicable to eligible Veterans only. It offers up to 100% financing.  More info

ITIN Program: Program for individuals who have a tax identification number.  More info

Foreign National Program: Program for investors outside the United States who are looking for an investment property in the second home in the United States. More info

Replacement and Rehabilitation Program: Designed to provide funds for Real Estate rehabilitation or to refinance mortgage and rehabilitation costs. More info

Additionally, there are a variety of programs, but they always depend on analyzing your case and making an assessment of their possibilities in relation to their capabilities.

FHA mortgages
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