Question 1

What is an FHA loan?

Accepted Answer

A Federal Housing Administration (FHA) loan is a government-backed loan that’s insured by the Federal Housing Administration. FHA loans typically have lower credit and down payment requirements for qualified homebuyers. For example, the minimum required down payment for an FHA loan is only 3.5% of the purchase price.

Question 2

How do I apply for an FHA loan?

Accepted Answer

If you’ve decided a Federal Housing Administration (FHA) loan may be right for you and you meet the established guidelines, including, but not limited to:Down payment amount: FHA loans require a minimum down payment of 3.5%.Credit score: FHA loans typically have lower credit requirements than many traditional loans.Property requirements: The home must be used as your primary residence and must meet safety, security and soundness standards, meaning the property shouldn’t have any structural defects. An FHA-approved appraiser must appraise the home.  You can start your application on your own or with the help of your mortgage loan officer, who can work with you to see if you qualify for an FHA loan.

Question 3

How do FHA loans work?

Accepted Answer

Federal Housing Administration (FHA) loans are available to all qualified buyers, regardless of income level. They often have more flexible lending requirements than conventional loans. All FHA loans require mortgage insurance, which protects the lender against any loss if mortgage payments are missed. To learn more about how FHA loans work, speak with your mortgage loan officer.

Question 4

What’s the difference between FHA and conventional loans?

Accepted Answer

Some of the differences between FHA loans and conventional loans include: FHA loans:Lower credit score and down payment requirementsRequire mortgage insurance regardless of down payment amount Conventional loans:May feature lower interest ratesUsually require less documentationOnly require mortgage insurance when the down payment is less than 20%May be used to buy a second home or investment property

Question 5

What is a VA home loan?

Accepted Answer

A Veterans Affairs (VA) loan is a home mortgage that’s backed by the Department of Veterans Affairs. To be eligible for a VA loan, you must be an active-duty service member, veteran or eligible surviving spouse. A VA home loan requires little or no money down at closing, and even with no down payment, mortgage insurance is not required.

Question 6

How does a VA loan work?

Accepted Answer

Veterans Affairs (VA) loans are available to active-duty service members, veterans and eligible surviving spouses. A Certificate of Eligibility from the VA is required to show whether you qualify based on your service history and duty status. Your mortgage loan officer will work with you to obtain the Certificate of Eligibility and can help you better understand how VA loans work.

Question 7

Who qualifies for a VA loan?

Accepted Answer

Veterans Affairs (VA) loans are available to active-duty service members and veterans who have served at least 90 days of consecutive service during wartime or 181 days during peacetime. National Guard members and reservists are eligible for a VA loan after six years of service or 181 days of active-duty service. Eligible surviving spouses may also qualify. For more information on how to apply for a VA home loan, contact your mortgage loan officer.

Question 8

Can I get a second VA home loan?

Accepted Answer

There are several ways active-duty service members, veterans and eligible surviving spouses can take advantage of a Veterans Affairs (VA) loan more than once. Here are some ways you may be eligible for another VA loan:Purchase a home with a VA loan and then sell it to buy another home with a new VA loan.Refinance an existing VA loan into another.Have two VA loans for two different homes at the same time.For more information on VA loans, speak with your mortgage loan officer.

Question 9

What is a fixed-rate loan?

Accepted Answer

A fixed-rate loan is one of the most common types of home loans. Benefits include a fixed rate, predictable monthly principal and interest payments and a flexible down payment. If you meet the U.S. Bank credit score and debt-to-income ratio (the ratio of total monthly debt payments – not including utilities, cell phone or cable service – compared to gross monthly income) requirements, a conventional fixed-rate loan may be a good option for you.

Question 10

What is a fixed home loan rate?

Accepted Answer

A fixed-rate loan is a type of loan that comes with an interest rate that won't change for the life of the loan. Check out today’s rates for a conventional fixed-rate loan or compare mortgage rates  for a variety of loan options. Connect with your mortgage loan officer to learn more about how fixed-rate loans work.

Question 11

Which is better: Fixed-rate loan or variable?

Accepted Answer

Monthly principal and interest payments on a conventional fixed-rate mortgage remain the same for the life of the loan, making it an attractive option for those who plan to stay in their home for several years. With an adjustable-rate mortgage (ARM), the interest rate may change periodically, based on a pre-determined index – for example, the U.S. Treasury – and margin set by the bank. The initial interest rate is fixed for a set period of five, seven or 10 years depending on the loan product, and then becomes variable. An increase or decrease depends on the market conditions at the time of the conversion to the variable rate and during the adjustment period thereafter. This may be a good option for those who plan on moving within a few years. Consider the benefits of each to determine which makes the most sense for your situation.

Question 12

What is a jumbo loan?

Accepted Answer

A jumbo loan is for single-family homes with loan amounts greater than $832,750. In certain high-cost areas, such as Alaska and Hawaii, the loan amount must be greater than $1,249,125. To qualify for a jumbo mortgage loan, you must meet the established guidelines for credit score, income and other personal financial information.

Question 13

How much is a jumbo loan?

Accepted Answer

Jumbo loans are mortgages that exceed conforming loan limits. The limit on conforming loans is $832,750 in most areas of the country, but jumbo mortgages can exceed these limits. The limit can be as high as $1,249,125 in certain high-cost areas, including Alaska and Hawaii.

Question 14

What is a VA jumbo loan?

Accepted Answer

A VA jumbo loan is a Veterans Affairs (VA) loan that exceeds the conforming loan limit of $832,750 and up to $1,249,125 in high-cost areas, such as Alaska and Hawaii. If you’re an active-duty service member, veteran or eligible surviving spouse and you meet the income and credit requirements, a VA jumbo loan could be an option for you.

Question 15

What is an ARM loan?

Accepted Answer

An adjustable-rate mortgage (ARM) is a home loan that has an initial fixed-rate period of five, seven or 10 years and an adjustable rate after the fixed-rate period ends. After the introductory rate term expires, the estimated payment and rate may change. An increase or decrease depends on the market conditions at the time of the conversion to the variable rate and during the adjustment period thereafter. An ARM loan could be a good option if you plan to sell within a few years.

Question 16

How does an ARM loan work?

Accepted Answer

With an ARM loan, the initial interest rate is fixed for a set period and then becomes variable, adjusting periodically for the remaining life of the loan based on market conditions. For example, a jumbo 10/1 ARM has a fixed rate for the first 10 years and an adjustable rate for the remaining duration of the loan, adjusting every year. A 7/6 ARM has a fixed rate for the first seven years and an adjustable rate for the remainder of the loan, adjusting every six months. To learn more about how ARM loans work, connect with your mortgage loan officer.

Question 17

Can you refinance an ARM loan?

Accepted Answer

Yes, an existing ARM loan can be refinanced upon credit approval. The benefits of refinancing a mortgage may include replacing the terms of your current loan with terms that are more favorable for you, lowering monthly payments, getting access to cash for major purchases and reducing your interest rate. Your mortgage loan officer can help you find the right choice for your needs.

Mortgage Partnership Manager

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