While loans backed by the Federal Housing Administration (FHA) and conventional loans are the most frequently discussed financing options, they aren’t for everyone. For those who qualify, it could be less common financing strategies are the key to securing their dream of homeownership.
In fact, many of the uncommon financing strategies offer benefits such as lower interest rates, no down payment mortgages, no private mortgage insurance, and low credit score requirements.
VA Loans
VA loans are loans backed by the Department of Veterans Affairs. They are available to qualifying active duty and retired members of our country’s armed forces. Additionally, they are available to some surviving spouses.
VA loans can be used to purchase single-family homes, condos, townhomes, and duplexes. In order to qualify for a VA loan, the home you are purchasing must be your primary residence and you must occupy the home with 60 days of closing. While this unique financing option has a variety of benefits, the biggest perk is the ability to put zero down.
USDA/RHS loans
Like VA loans, USDA and RHS loans do not require a down payment. Provided by the
United States Department of Agriculture (USDA)’s Rural Housing Service (RHS), these loans are for those with a low to moderate income who reside in rural areas and wish to purchase a single-family home. These loans are only available to those who want to live within pre-specified areas of the US, are U.S. citizens, and whose monthly mortgage payment will be less than 29% of their monthly income. Additionally, you’ll be have to meet minimum credit score requirements.
Physician Loans
As a newly licensed medical doctor, resident or fellow it’s not uncommon to be saddled with a fair amount of debt. This high debt and often lack of excess cash can often make it difficult for medical professionals to secure the dream of home ownership. Physician loans are designed to help these highly skilled medical professionals overcome this hurdle.
Qualifying requirements vary, but typically include proof of employment. In some instances, lenders may offer up to 100% financing and a no down payment option.
Have additional questions about uncommon financing strategies? Talk to a Fairway Kirkland loan officer today.
WRITTEN BY
Katrina Turner
Katrina Turner works for Fairway Sound, one of the top branches of Fairway Independent Mortgage Corporation.
