July 7, 2011

Acquiring a Hawaii Real Estate through Home Loans

There are many different types of mortgage or housing loans to choose from if you are planning to acquire a home.  Check out the following mortgage types and carefully study each one of them:

  1. Conventional Mortgage.  In a conventional mortgage, the interest rates applied to it will remain unchanged from the time you have obtained it until you’ll be able to pay off the entire amount even if it means 30 long years from now.  Any person with an acceptable credit rating can avail of this mortgage.  You’ll be required to pay 10% to 20% down payment and the amount of down payment usually depends on your credit rating, credit record, and on your debt-to-income ratio.
  2. Adjustable Rate Mortgage (ARM).  The interest rate of this type of mortgage is dependent on the market or economic condition.  This means that your monthly repayments are unpredictable.  
  3. Bridge Mortgage.  This mortgage is for homeowners who are planning to move into a new home.  This bridge mortgage, however, is not for the home to be purchased, but for the first home that is being sold to use it as collateral.   
  4. Jumbo Loans.  As the name suggests, jumbo loans involve a big mortgage and they are usually more than $350,000.  The interest rates applied on this type of loan vary and they depend on the changes in the current market.    
  5. No Closing Cost Loans.  What’s good about this loan is that no fees will be charged upon application.  However, the interest rates for this type of loan are much higher. 
  6. Interest Only Mortgage.  With this interest only mortgage, borrowers are allowed to pay only the interest for a certain period, usually about a year, without affecting the principal amount.   
  7. FHA Loans.  This mortgage is granted to people with the required debt-to-income ratio.  In case you fail to settle your FHA loan, the Federal Housing Authority will have to settle it for you.  The money will be taken from the insurance premium that FHA has collected from you and from other borrowers of this loan.  Unlike other mortgages, this loan allows borrowers to take out a bigger mortgage and pay much lesser down payment, which is only at about 3%.  This is a good type of loan for individuals who are willing to pay an insurance premium on a monthly basis. 

VA Loans.  This loan is intended only for the veterans of the U.S. military. Conventional loans are offered to the veterans without requiring them to pay any down payment. 

Posted in Mortgage
Share This Post
Please enable Javascript to comment on this blog