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Types of Mortgage Loans

Types of Mortgages Infographic

Fixed Rate and Adjustable-Rate Mortgages

Fixed Rate Mortgage

Pros of a Fixed Rate Mortgage:

- It locks in the interest rate
- Rising interest rates and higher inflation won’t impact the rate
- Available under a variety of terms

Cons of a Fixed Rate Mortgage

- Qualifying can be difficult
- When interest rates drop existing rate is locked in at the higher rate
- May be less flexible than a variable rate loan

Adjustable Rate Mortgage (ARM Loan)

Pros of an ARM Loan:

- Low introductory rates and greater flexibility
- Payments can decrease if interest-rates fall
-Could potentially save thousands of dollars over a fixed-rate mortgage

Cons of an ARM Loan:

- Greater complexity
- Potential for much bigger payments over time
- Possible inability to sell or refinance when you want to

Government Backed Mortgages 

FHA Loan

Pros of FHA Loans:

- Low down payment with low credit scores
- Higher debt-to-income ratio (DTI) is allowed
- Less expensive monthly mortgage insurance for low credit scores

Cons of FHA Loans:

- Higher total mortgage insurance costs
- Limited to a primary residence only
- Lifetime mortgage insurance expense

VA Loan

Pros of VA Loans:

- No down payment
- No private mortgage insurance (PMI)
- Higher allowable debt-to-income (DTI) ratio

Cons of VA Loans:

-  Mandatory VA Funding Fee charged by the VA
-  Intended for primary residences
- Not all real estate agents are familiar with VA loans

Other Popular Loans

Conventional Loan

Pros of Conventional Loans:

- Competitive interest rates
- Low down payments
- PMI can eventually be eliminated

Cons of Conventional Loans:

- Generally lower debt-to-income ratios are required
- A minimum credit score is required to qualify for a loan
- Larger down payment

 

VA Loans

VA Loans

Discover affordable financing at great rates exclusive for veterans and current military members.

VA Loans
Fixed Rate Loans

Fixed Rate Loans

Lock in a low rate and payment that stays the same, no matter how much else may change over time.

Fixed Rate Loans
FHA Loans

FHA Loans

Get approved with less-than-perfect credit or buy with a lower down payment.

FHA Loans
Adjustable Rate Loans

Adjustable Rate Loans

Boost your buying power with low rates and flexible terms.

Adjustable Rate Loans
Investor Loans

Investor Loans

Get competitively priced mortgages tailor-made for investment properties.

Investor Loans

Our Mortgage Rates

Learn more about what goes into a mortgage rate, what kinds of rates are available to you, how your rate will be calculated, and how you can ensure that you get the best mortgage rate.

NEWREZ MORTGAGE RATES