YOUR Louisiana HOME LOAN OPTIONS
Here at Essential Mortgage and our team of mortgage lending experts offer a wide range of home loan options for every need and budget. The right one depends on your homebuying goals, the down payment you have available, your financial scenario, and other factors.
Here are just a few of the types of mortgage loans you can choose to use for your Louisiana home purchase.
Fixed-rate mortgages come with a set, consistent interest rate for the entirety of the loan term. This means your payment won’t change drastically year over year, and the interest you’re paying won’t fluctuate based on changes in the market. The only way to change the terms or interest rate on a fixed-rate loan is via refinancing.
BENEFITS OF FIXED-RATE LOANS
- Payments and interest rates are consistent and predictable
- Easy to budget and plan for
- Ideal for buyers looking to stay put
Adjustable-rate home loans have interest rates that can change over time. They come with a fixed rate for a set period (3, 5 or 7 years, usually), after which point, the rate can go up or down depending on the index the loan is tied to. Adjustable-rate mortgages (also called ARMs), typically offer a lower up-front interest rate and lower monthly payment, at least the start.
BENEFITS OF ADJUSTABLE-RATE LOANS
- Low up-front interest rates
- Low up-front monthly payments
- Buyers only staying for the short-term may save money
FHA mortgages are guaranteed by the Federal Housing Administration and are designed to make buying a home more affordable for low- and middle-income earners. They require minimal down payments (as low as 3.5 percent if you have a good credit score), and they offer competitive interest rates compared to other loan options. One downside to FHA loans is that they require private mortgage insurance — an added monthly cost — if you can’t afford a 20 percent down payment.
BENEFITS OF FHA LOANS
- Down payments as low as 3.5 percent
- Flexible credit requirements
- Allow for higher debt-to-income ratios than other loan options
- Offer competitive interest rates
Veterans Affairs mortgages are designed for veterans, military members and their surviving spouse. They require no down payment or mortgage insurance, and they limit the amount of closing costs a buyer can pay.
BENEFITS OF VA LOANS
- Lower interest rates
- No down payments
- No private mortgage insurance
- Limited closing costs
- Funding fee can be rolled into the loan
Jumbo loans are designed for higher-priced homes that exceed the conforming limit set by Fannie Mae. As of 2022, this limit was $726,200. In more expensive markets, the number might be higher.
BENEFITS OF JUMBO LOANS
- Higher loan balance limits
- Offered in fixed- and adjustable-rate formats
USDA loans are for use on homes in designated rural parts of the country. They are guaranteed by the U.S. Department of Agriculture and require no down payment. They’re ideal for low- and middle-income earners willing to buy in a rural area.
BENEFITS OF USDA LOANS
- Lower interest rates
- No down payments
- No penalties for prepaying
- Low private mortgage insurance premiums
- PMI premiums can be rolled into the loan
- Flexible credit requirements
WHICH TYPE OF MORTGAGE LOAN IS RIGHT FOR YOU?
Not sure which type of home loan is best-suited for your budget and homebuying needs? Then reach out to Essential Mortgage today. We’ve helped hundreds of Louisiana homebuyers finance the home of their dreams, and we can help you, too. Get in touch today to get started.