Skip links

New Home loans

Comparison of the Various Home Loan /Mortgage products for the prospective Homebuyers!

Buying a home is a big decision that requires various aspects to be taken into consideration. First and foremost among these is the best home loan/ mortgage product to go for that suit the individual financial objectives.

If you’re planning to buy a home anytime soon, this is your comprehensive guide to the best Home Loan/Mortgage products for all your needs.

Various Home Loan types available for the prospective home buyers:

This is the best option for anyone who plans to buy the home from a  long time perspective, have an established credit history, and can put at least 5% down payment amount. Some of the benefits of the conventional fixed-rate loans are discussed below-

  • This type of the Home Loan offers the lowest fixed rates for the eligible home buyers
  • It is a very transparent product with no interest-rate surprises as such for the customers

A decent option for anyone with an established history, have the capacity to pay 5% of down payment of the total amount and knows that he/she will be moving out of the house soon. Some of the benefits of the Adjustable-rate Mortgages are discussed below-

  • The product offers initial lower monthly payments that gradually increases with time
  • Offers the lowest short-term rates to the prospective homebuyers
  • Another benefit of the ARMs is the initial rate periods of 3-10 years, post which the rates can adjust up or down

FHA loans offer a great opportunity to anyone who struggles with not having an established credit history or have experienced various credit challenges in the past. Furthermore, the limited fund’s requirement for the down payment is another attraction of the FHA loans. Some of the benefits of the FHA loans are discussed below-

  • Lower down-payment requirements (as low as 3.5%)
  • Less rigorous lending standards
  • Insured/ backed by the Federal Housing Administration

The VA loan is a specialized mortgage loan category that is guaranteed by the U.S. Department of Veterans Affairs (VA). This type of home loan is only issued by the approved lenders and is backed by complete government security.  VA loan is a unique and a powerful financial tool in the form of a home loan that is created specifically for the military homebuyers. Some of the benefits of the VA loans are discussed below-

  • Extremely low or no down payment requirement
  • Flexible qualification guidelines for the VA loans
  • Fixed-rate and ARM options available in this loan type
  • No mortgage insurance requirement in VA loans

The VA loan is a specialized mortgage loan category that is guaranteed by the U.S. Department of Veterans Affairs (VA). This type of home loan is only issued by the approved lenders and is backed by complete government security.  VA loan is a unique and a powerful financial tool in the form of a home loan that is created specifically for the military homebuyers. Some of the benefits of the VA loans are discussed below-

  • Extremely low or no down payment requirement
  • Flexible qualification guidelines for the VA loans
  • Fixed-rate and ARM options available in this loan type
  • No mortgage insurance requirement in VA loans

It is an ideal option for someone looking to build a new home to your specifications or want to buy a lot for a future home. Some of the benefits of the new construction loans are discussed below-

  • Availability of convenient financing for new construction

The product offers construction-to-permanent loan options to the prospective investors

The process of Home Loan Refinancing

The process of refinancing the existing home loan is pretty simple and work as below-

  • Once the home loan investor identifies the opportunity with a lender who offers better rates, terms, and conditions, they initiate the process of refinancing the existing home loan
  • Home loan investor reaches out to the new lender with details, which in turn, settle all the dues with the existing lender and take over the outstanding loan amount
  • After the completion of all the refinance formalities, the investor start paying EMIs to the new lender

Important guidelines before you apply for the Home Loan

Below are the main types of loans available in the market-

1. Determine your eligibility
One of the most important things to do before you begin the home loan application process is to determine the total eligibility depending on-

  • Repaying capacity
  • Monthly disposable/surplus income
  • Monthly income/surplus less monthly expenses
  • Other factors such as spouse’s income, stability of income, assets, liabilities etc

2. Document preparation
Every home loan sanctioning by the lenders is heavily dependent on the relevance and the completion of the documentation. Make sure to gather the entire set of the essential documents before you start the home loan application process. Some of the important ones include-

  • Latest pay slips from the current employer
  • All the educational qualification certificates
  • Accurate proof of business existence
  • Bank statement records of the past 1 year
  • Profit/loss statement and balance sheet of the business for last 3 years
  • Complete property papers that you wish to purchase. It is important to remember that banks do not process the home loan application without the valid ‘agreement to buy/ sell’ the property to wish to buy

3. Improve your credit report
To make yourself Home Loan ready, check your credit information report at least few months before you apply for the loan. Not only it will allow you the time to take the necessary corrective measures to improve your credit scores, it will also boost your confidence as you apply for the Home Loan.

54%

of first-time home buyers bought because they were tired of renting.

Get free personalized mortgage rates in minutes

Featured Mortgage Articles

HOW TO GET BEST POSSIBLE MORTGAGE RATE?

                              HOW TO GET BEST POSSIBLE MORTGAGE RATE?   Everyone knows about the low mortgage rates but how can anyone get these rates? This is an important question. Everyone is looking for the best mortgage rate available. There are many ways known for finding the best possible rate. It is an important decision as it […]

Rates in 2018 are Increasing

The interest rates in 2018 are increasing, and the question is, are you ready for it? The Fed gradually reduced the $4.2 trillion portfolio of United States Treasury debt in the third quarter of 2017 due to which it was clear that the economy’s steady growth will continue and the interest rates in 2018 will […]

How To Buy A Home With No Money Down In 2018

How To Buy A Home With No Money Down In 2018

How To Buy A Home With No Money Down In 2018 If you want to buy a home but you have no money for the down payment, you may be in luck. 87% of first-time buyers think they need 10%or more down payment to buy a home, according to National Association of Realtors. That’s simply […]

Return to top of page