Understand Home Financing Options to Pick the Right Loan for You

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With so many options out there, it can be hard to decide which home financing option works best for you and your family, especially if you are buying your first home or facing an unexpected financial change in your life. Luckily, as long as you have a reliable mortgage broker, you are sure that the choice you make will meet your needs now and in the future. Here are five options for home financing in Pompano Beach. 

Adjustable-Rate Mortgage (ARM) 

Depending on a particular benchmark’s performance, your interest rate can fluctuate over time in an adjustable-rate mortgage. The interest rate on the outstanding debt is reset on a yearly or even monthly basis. For purchasers who want to keep the loan for a short period and can afford any future interest rate hikes, an ARM might be a wise financial decision. 

 FHA Loans 

An FHA loan is a mortgage insured by the Federal Housing Administration (FHA). The FHA charges a small insurance fee to guarantee that lenders will make good on their loans.  

FHA loans are an attractive option for borrowers who have less than perfect credit or don’t have large down payments. With a low enough credit score, you can get up to 96.5 percent of a home’s value; hence only a 3.5 percent down payment is necessary. 

VA Loans 

This type of home loan, insured by the U.S. Department of Veterans Affairs, enables veterans to buy a home with no down payment and qualify for below-market interest rates. These loans do not require a down payment, and any closing expenses are usually limited where the seller covers them. 

Fixed-Rate Mortgage 

A fixed-rate mortgage can keep your home loan payments consistent, which is ideal if you’re planning to stay in your home for a while. Depending on how much money you borrow, you get locked into a 30-year or 15-year repayment plan, and you’ll pay an interest rate that doesn’t change over time. 

USDA Home Loans 

These loans are ideal for buyers who plan to live in rural areas and have limited access to financial services. They are also applicable in USDA-eligible places to meet certain income-related limits to qualify. The USDA doesn’t require a down payment or private mortgage insurance, but there are some extra fees which include an upfront of 1% of the loan amount and an annual fee. 

Home Financing in Pompano Beach 

Getting a mortgage is often confusing. As such, it’s a good idea to seek out a qualified mortgage broker to help you navigate your options and find the right loan for you. For more information on your financing options, reach out to us at Ace Mortgage, and let us assist you in securing your dream home. 

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