The Arizona real estate market has been growing rapidly with the increased need for people to get their own homes. Surveys show that with the many mortgage options available, a large percentage of people are finding it easier to start their homeownership journey. This has also created a lot of demand for different types of properties. If you want to find the right home loan, it’s essential to compare multiple options. Here are the main types of Arizona home loans:
1. VA Home Loans
VA loans are guaranteed by the Veterans Affairs department. This means that if a borrower defaults, the government is responsible for paying back the defaulted debt. The best thing about VA loans is that no down payment is needed, unlike other conventional mortgage options. These loans are specifically made for the veterans, military personnel, and surviving spouses of those who died in service. The VA loan limit in Arizona is currently $548,250.2. Home Equity Loans
They’re also known as second mortgages. You can qualify for a home loan through your existing home equity. Home equity loans are mainly used for home improvement. These loans usually have a shorter duration (10-15 years) and come at pretty higher interest rates.3. FHA Home Loans
These loans are used to buy, renovate or refinance a property. The FHA has some limits on how much money you can get as a borrower to reduce the risk to the lender. FHA home loans have a favorable down payment (3.5%) and credit score (500) requirements. These loans also don’t have prepayment fees meaning that you can pay earlier than the scheduled duration.4. USDA Home Loans
These loans are offered by the US agriculture department. They’re specifically made to help low to average income earners, especially those in rural areas, to acquire their dream homes. USDA home loans generally have low closing costs and don’t require down payments like conventional home loans. Apart from buying a new home, a USDA home loan can also be used to renovate an existing home.5. Jumbo Loans
These loans are made for homebuyers looking for luxurious and highly-priced homes. Jumbo loans aren’t offered by all mortgage lenders since they possess a high credit risk. Jumbo loans also have a higher interest rate compared to standard Arizona home loans. These are some of the types of home loans in Arizona. You can also get HELOCs and zero-down mortgages.Latest Articles
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