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Today’s mortgage alternatives

Types of Home Loans and their Explanations

At your ASAP Financial Services, we offer many different types of home loans, but all you really need to know is whether you want to purchase or refinance and one of our Senior Loan Officers will work with you to put together a customized home loan package that is best for you.

You'll spend more on your mortgage than you ever will on your house. Your home loan could be the biggest purchase you ever make. It makes sense to choose it carefully, we will help you with all the details, but we want you to know of all your choices.

Here is information about the different types of loans:

The major loan categories are conventional and government. Conventional loans can be further categorized into conforming and non-conforming.

q    Conforming Loans

A conforming loan adheres to the guidelines established by Fannie Mae or Freddie Mac. These guidelines establish maximum loan amounts, down payment, credit and income requirements and acceptable property types. Lenders that make loans according to these guidelines may sell them to Fannie Mae or Freddie Mac. Conforming loans make up the majority of loans in the U.S.

q    Non-conforming Loans

Loans that do not conform to the guidelines established by Fannie Mae or Freddie Mac are called non-conforming loans. A loan that is larger than the conforming loan limit is called a Jumbo loan. Loans that do not meet the credit quality of conforming loans ('A' paper) are referred to as 'A-' through 'D' paper loans, or sub-prime loans.

q    Government Loans

FHA and VA loans are the two most popular types of Government loans. Government loans have different loan limits and qualifying criteria compared to conventional loans.

q    30-Year Fixed-Rate Mortgage offers a predictable monthly payment and protection from interest rate increases. However, to take advantage of falling rates you must refinance and pay closing costs and other fees.

q    15-Year Fixed-Rate Mortgage may offer a lower rate than a 30-year loan. You’ll build equity faster, cut overall interest costs and own your home free and clear in only 15 years.

q    Adjustable-Rate Mortgage (ARM) will probably offer a lower initial rate than fixed-rate loans. The rate can fluctuate up or down, but many ARM’s have rate caps limiting increases. The option of converting and ARM to a fixed-rate mortgage is currently available from some lenders. The Convertible ARM allows the borrower to lock in an interest rate and predictable payments for a smaller fee than would normally be charged to refinance.

q    Graduated Payment Mortgage is designed for buyers with the potential of future income growth. Monthly payments start low and increase over the 15 or 30-year term

q    Bi-weekly Mortgage allows you to pay off your loan quickly. By making 26 bi-weekly payments per year you save on interest and build equity faster.

Which is best for you? Our expert Senior Loan Officers can help. Contact us at 281-265-1474 or click here to get started.

From the comfort of your own home, you can apply online and begin to gather the documents you'll need to get your loan approved. It's that easy!

ASAP Financial Services

4675 Sweetwater Blvd.

Sugar Land, TX 77471

Office: 281-265-1474

Fax: 281-494-7377