Texas Mortgage Loan Programs
For individuals and families who like the wide open spaces, The Lone Star State has plenty of options to offer, especially when it comes to finding a place of your own. Getting The Federal Housing Administration sponsors an FHA home loan program, however, is not as easy as getting a dog or a date. For some, a home loan is the most practical and affordable option, and this year you will find many mortgage companies that offer the best home loans in Texas.
A conventional home loan is a loan that is not guaranteed or insured by the federal government, unlike the FHA, USDA, and VA. This entails a higher risk on the part of the lenders, which is why these types of loans require a higher credit score and sometimes higher down payments. The benefits of getting this type of loan include less stringent process and lesser processing time.
Government-insured Home Loans
An FHA home loan program is sponsored by the Federal Housing Administration, meaning the FHA insures the loan against default. This takes out a substantial amount of risk from mortgage lenders who, in turn, require lower down payment from potential borrowers and lower credit score requirements. Keep in mind, however, that as in any other loans, the lenders will still look at your credit history, your income, and your other assets.
A VA loan is a program guaranteed by the US Department of Veterans Affairs and is available only to servicemen and women and eligible spouses. Although it requires a slightly higher credit score, VA loans require 0% down payment. That’s right. Zero down payment. This is the government’s way of making home ownership within easy reach of its servicemen and their families.
A USDA Loan, on the other hand, is a home loan program backed by the United States Department of Agriculture. Like the VA loan, it requires zero down payment but also requires that the property you are trying to buy is within a USDA eligibility map. Usually, these are properties in the rural or suburban area but take note that the criteria have not been updated for years and what was considered a rural area several years back have now become busy suburbs with access to major cities, sophisticated shopping and entertainment centers, good schools and healthcare facilities. Consider this fact in buying a home as you will never know when they will be updating their map of eligible properties.
In addition to these home loan programs, you might also be interested in learning about a fixed rate mortgage and an adjustable rate mortgage.
As the name suggests, a fixed rate mortgage is one that has the same interest rate for the entire term, and this is what mortgage lenders usually offer. In adjustable rate mortgages, on the other hand, the monthly amortization homeowners pay can vary over time.
So, if you are one of those that love the wide open spaces, perhaps getting a USDA loan in one of charming rural or suburban areas of Texas could be the most appealing option for you. You can check online for the best Houston mortgage lenders who can help you discover the best deals in Texas this year and beyond.