Home loans – Check out the different loan types available in the market

A home is an essential part of our lives. It is where we come back after the whole day’s hard work. But it is not very easy to buy a home. Not everyone in this world has the cash money to purchase a home. In such a situation, home loans or mortgages play an important role. There are various banks and financial institutions like Heritage Home Loans, Bank of America, Chase, etc. which will help you in getting home loans. However, in order to get home loans from these organizations and institutions, you will have to meet their required criteria. As we all know, the real estate crisis had an immense impact on the lending standards of the lenders. In such a situation, the lenders make sure that you satisfy all the required criteria before they approve you for a loan.

Types of home loans

Financial institutions such as Heritage Home Loans, Chase, etc., offer different type of home loans to the borrowers. Some of them are as follows:

Conventional loans: Such loans are offered by most of the lenders if the borrowers have a stable employment and income and satisfy the credit criteria. Of late, financial institutions want borrowers to have credit scores above 700 in order to offer such loans. Moreover, borrowers should have the required DTI ratio as set forward by the borrower.

FHA loans: Such loans are offered only by the FHA insured lenders. These loans have flexible criteria compared to the conventional loans. Borrowers, who have low credit scores or do not have the required down payment, normally apply for such loans. These loans are comparatively easier to get for the borrowers.

Reverse mortgage: This type of mortgage is mainly available to the senior citizens – especially those who are more than 62 years of age. With this type of a mortgage, a senior citizen can purchase a new home. He or she can even get this mortgage using an existing property as collateral. There are not much requirements for such kind of a home loan.

USDA loans: Such loans are mainly available for rural properties at a flexible rate and term. However, not all lenders will offer you such loans. Moreover, there are various criteria which you and your property need to meet in order to get the loan.

VA loans: Such loans are available for veterans. Thus, VA sponsored lenders can only provide the veterans with such loans. Similar to USDA loans, these loans are also available at a flexible rate and term.  However, they have stringent criteria which veterans need to meet in order to get qualified for such loans.

Hope now you know the different types of loans available in the market! If you meet the required criteria of the lender, you can qualify for any loan type.