Financing Details and How They Affect Your Offer
Other Financing Details in Your Offer
Your offer should also contain information on which type of mortgage loan you will be receiving (fixed rate or an adjustable rate mortgage). It is also common practice to also include whether you are obtaining conventional financing or obtaining a FHA or VA loan.
The FHA insures loans – FHA-insured mortgages are in high demand because of the many advantages they hold for homebuyers and refinancers, among them assumability, low down payments and liberal qualifying ratios. Also, FHA borrowers do not have to meet maximum income qualifications, as with many other government programs. Maximum loan amounts, however, are set by region across the country.
The VA Guarantees Loans. – As a benefit to veterans, the Department of Veterans Affairs guarantees repayment of loans made to veterans with no down payment in most cases and liberal qualifying guidelines. This makes it easy for veterans to finance their homes.
A Conventional Mortgage loan does not exceed 75% of the lower of either the purchase price or the appraised value of the property.