Bradenton Florida is a great place to live! If you are looking to buy a home here, chances are that you’re going to need a home loan. But how do you know which one is right for you?
There are several different types of home loans, and here, we’ll break down the main types to help you understand which type of loan you might want to try to get.
Fixed-Rate
A fixed-rate mortgage is probably the most common type of home loan. These mortgages are usually offered for either 15 years or 30 years and provides an interest rate that remains the same over its entire term. Many buyers opt for fixed-rate loans because they offer a sense of security (you always know exactly how much you’re going to owe every month) as well as the freedom to add monthly payments if desired.
Conventional Loan
Conventional loans, unlike many other types of loans, are not backed by the government at all. These loans could be backed by a local finance company or a major bank. “Conventional loan” is an umbrella term that might include fixed- or variable-rate loans. Regardless, if it’s not backed by the government, it’s a conventional loan. These loans do typically come with costs like a down payment and closing fees.
FHA Loans
FHA loans are insured by the Federal Housing Administration, meaning they’re backed by the government. Of all the types of home loans, this one might be the best for those with lower credit scores or who don’t have a ton of money for a down payment. Purchasing a home using an FHA loan allows you to make a down payment as low as 3.5%, and those with credit scores as low as 500 may qualify. If you’re looking at houses for sale in Bradenton, FL but are worried about your credit score, this is definitely a loan option to consider.
VA Loans
If you are an active military service member or a veteran, we highly recommend looking into a VA loan. These loans are backed by the Department of Veteran Affairs and don’t require any down payment, though an upfront VA funding fee is required (the amount of this fee can vary from year to year). Those who have served in the military and are looking for a low interest rate without the need for a down payment could find a VA loan is their best option.
Adjustable-Rate
While fixed-rate mortgages have a locked interest rate for the entirety of the loan period, adjustable-rate home loans Offer a fixed rate for a specific period of time that then adjusts periodically. For instance, your initial rate might be locked in for five years, then it will adjust annually and will likely be higher than the initial rate. If you don’t plan to have your mortgage for a long time, an adjustable-rate loan might be appealing.
Variable-Rate
Variable-rate mortgages charge an interest rate that is completely dependent on the fluctuations of the market. While these loans can be somewhat unpredictable, they could be a good option depending on the market. In most cases, though, variable rates start out low and increase with time. This type of loan might be best for you if you only plan to have the home for a little while.
Are You Ready To Find Your Home
You have found your dream location, and its time to find a home, and secure a home loan! Let us help you complete your dream, whether its a full time home, or an investment home.
While you’re browsing through the homes for sale in Bradenton, FL, keep these types of loans in mind. When you’re ready to make a purchase, consider working with one of the top Anna Maria Island real estate companies: Beach Sales Mobi. We are proud to help you find the home of your dreams, and walk you through the entire purchasing process. Browse our current listings and contact us today For more information! If you are trying to sell a home, we can help with that as well! Whether it’s tips for staging your home and finding the right buyer, we can help!
