There are many different types of Government Loan Programs. Here are the three most popular:
An FHA loan is insured by the Federal Housing Administration, a federal agency within the U.S. Department of Housing and Urban Development (HUD). The FHA does not loan money to borrowers, rather, it provides lenders protection through mortgage insurance (MIP) in case the borrower defaults on his or her loan obligations. Available to all buyers, FHA loan programs are designed to help creditworthy low-income and moderate-income families who do not meet requirements for conventional loans.
FHA loan programs are particularly beneficial to those buyers with less available cash. The rates on FHA loans are generally market rates, while down payment requirements are lower than for conventional loans.
FHA loans carry a mortgage insurance premium (MIP); how much it is and how long it lasts depend on the loan's terms.
FHA limits the amount lenders can charge for some closing cost fees.
VA guaranteed loans are made by lenders and guaranteed by the U.S. Department of Veteran Affairs (VA) to eligible veterans for the purchase of a home. The guaranty means the lender is protected against loss if you fail to repay the loan. In most cases, no down payment is required on a VA guaranteed loan.
Closing costs are comparable and sometimes lower - than other financing types.
The Mortgage can be taken over (or assumed) by the buyer when a home is sold.
Counseling and assistance available to veteran borrowers having financial difficulty or facing default on their loan.
Although mortgage insurance is not required, the VA charges a funding fee to issue a guarantee to a lender against borrower default on a mortgage. The fee may be paid in cash by the buyer or seller, or it may be financed in the loan amount.
A VA loan can be used to buy a home, build a home and even improve a home with energy-saving features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/caulking, storm windows/doors or other energy efficient improvements approved by the lender and VA.
Veterans can apply for a VA loan with any mortgage lender that participates in the VA home loan program. A Certificate of Eligibility from the VA must be presented to the lender to qualify for the loan.
Ask us for the full list of VA loan requirements, or see our VA Loans page.
USDA loans are made on properties within a qualifying rural area. Applicants with very low to moderate incomes can qualify for these loans, but still able to afford the housing payments, including the principal, interest, and insurance that are part of the monthly payment amount.
The property doesn't have to be a farm or open land to qualify for this type of loan. It just has to be in a qualifying area.
Want to know which of these programs you may be eligible for? Vivid Mortgages arranges FHA and VA loans for New York borrowers through third-party wholesale lenders. See our FHA Loans in New York and VA Loans pages, or call 800-880-8557 to get pre-qualified.
Talk to a New York mortgage broker
Get pre-qualified online, or call and a broker will walk you through your options. No obligation, and pre-qualifying does not affect your credit score.
