The successful home buying experience is all about making the right decisions and engaging the right stakeholders. One of the critical decisions to make when buying a home in Arizona is to finance your dream project. Not every buyer is lucky to afford a cash amount for buying a house in Arizona. Luckily, Arizona home buying programs offer the best deals. Are you thinking about buying a home in Arizona? Financing your dream home has never got more comfortable. This post features the different Arizona home buying programs you need to know.
1. The FHA Home Buying Program
The Federal Housing Administration is the largest home mortgage insurer. If you thought buying a home in Arizona is impossible without a 20% down payment, the FHA is for you. FHA home loans allow the buyer to purchase a home with as little as a 3.5 % mortgage down payment. Generally, the FHA home loan is friendlier, offering buyers loans with a credit score of as low as 500. Therefore, if you feel locked out of homeownership because of a low credit score of less than 580 but more significant than 500, all you need is a down payment of 10% or above to secure the FHA home loan.
Here is an overview of the requirements to qualify for the FHA home buying program:
- A 3.5 percent down payment and a credit score of 580 and above
- A down payment of 10% and a credit score is below 580 and above 500
- Applicants should have a debt to income ratio of 50% or less.
- Provide proof of employment or steady source of income
- You must live in the home as your primary residence.
- You have not had a foreclosure in the last three years.
The FHA home loan offers friendlier requirements to the borrowers. To apply for the FHA home loan, contact a qualified mortgage broker to help you discover the best mortgage lenders.
2. The VA Home Loan
Backed by the United States Department of Veteran Affairs, the VA home loan is a mortgage product designed for the active-duty military and the veterans. The home buying program was designed to assist qualifying member’s access to affordable home mortgages. Therefore, if a qualifying member wants to purchase a home but does not have any savings to pay the down payment, the VA home loan offers a suitable option. While the FHA home loan requires a minimum down payment of 3.5%, the VA home loan does not require any down payment.
Another benefit of the VA home loan is, no monthly mortgage insurance premium is required. Therefore, while the FHA and the conventional home loan requires a monthly premium payment, the VA home loan does not require the PMI. Further, the VA home loan features lower average interest rates compared to the conventional home loan.
Here are the requirements for the VA home loan:
- Applicant must have been on active duty and served for 90 continuous days.
- Must be a veteran and met the length-of-service requirements
- Completed the 90 days of active-duty service
- Surviving spouse of a veteran who passed on while in service
Do you meet the above qualification criteria? You can apply for the VA home loan through a bank or a mortgage company. Talk to your mortgage broker near you for guidance.
3. The USDA Home Loan
Guaranteed by the United States Department of Agriculture, the USDA home loan offers big deals for those wishing to purchase a home within the eligible rural areas. The USDA home loan intends to facilitate affordable homeownership opportunities to the low to moderate-income households. The USDA home loan offers borrowers various benefits, including:
- 100% financing
- Competitive interest rates
- Low monthly mortgage insurance
- Flexible credit requirements
To qualify for the USDA home loan, you must meet the following eligibility requirements:
- S Citizenship or permanent residency
- Have a dependable income for typically two consecutive years
- Willingness to repay the mortgage
- An acceptable debt ratio
Before applying for the USDA home loan, check the income limits in your area. Talk to a home mortgage broker near you for guidance on applying for the USDA home loan.
4. The Conventional Home Loan
The conventional home loan is available to borrowers with a steady income and can afford the required down payment. When applying for the traditional home loan, check out for the mortgage borrowers who offer best interest rates. The traditional home loan does not require private mortgage insurance if the down payment is 20% or above. Under some circumstances, the mortgage lender pays the closing costs and mortgage fees.
Are you ready to buy a home in Arizona? Consider either of the above home loan options. Arizona home buying programs provide affordable interest rates and friendlier requirements. Talk to the mortgage broker near you for assistance through the application process.