Popular mortgage programs in North Carolina

If you are buying a home in North Carolina you may like to know the popular mortgage programs for our area.  The top three loan types I see being used are Conventional, FHA and FHA with a down payment assistance program.  

Conventional Mortgages

Conventional mortgages are loans that adhere to Fannie Mae or Freddie Mac guidelines.  ‘Fannie’ and ‘Freddie’ are Government Sponsored Entities that buy and sell conventional mortgages. They set the maximum loan amount ($417,000 for our area) and requirements for borrowers. Conventional mortgages require at least a 5% down payment and will require mortgage insurance if the down payment is less than 20%.  Many borrowers opt for a 30 year term but shorter terms are available. 

FHA Loans

Another popular mortgage program is the FHA loan which allows for a 3.5% down payment, instead of the higher percentage required to secure many conventional loans. Taking advantage of the FHA loan program is a great way for buyers to buy a home with a smaller down payment. Another advantage of a FHA mortgage is that the credit qualifying criteria for a borrower are not as strict as conventional financing.

FHA Loans with Down Payment Assistance

Some first time home buyers also opt to pair a FHA loan up with a down payment assistance mortgage program like NC Housing Finance Agency (NCHFA)or House Charlotte.  This isn’t a separate loan type but more akin to a sidecar to a FHA loan.  Depending on the borrower’s income, credit history and the home’s price and location, a home buyer can obtain funds for their down payment and/or closing costs.

Want counsel on what mortgage program best fits your needs?  Contact Rebecca at www.rebeccamadej.com to have a personalized assessment.