What Is A Fixed Rate Mortgage?
As its name implies, a fixed rate mortgage is one where the interest rate on your home loan remains the same throughout its duration. This differs from a loan where the interest rate may change over time, such as an adjustable rate mortgage. Fixed rate mortgages are the most popular form of home loan in the United States largely due to the appeal of a consistent mortgage payment amount over the life of the loan.
In many instances, fixed rate mortgages have higher mortgage payments than adjustable rate mortgages. This is most often because the interest rate remains unchanged for the duration of the loan. Typically, loans with longer terms will have a higher interest rate than loans with shorter terms due to interest rate risk, or the possibility of fluctuating interest rates.
Fixed Rate Mortgage Benefits
The biggest benefit of a fixed rate mortgage is the fact that the interest rate does not change over time. This allows you to budget your finances and make a consistent, fixed payment over the duration of your loan.
Fixed rate mortgages allow you to lock in an interest rate and principal payment for the entire life of your loan. Your rate and principal payment never increase, even if the market changes – giving you peace of mind.
Other benefits include:
• Competitive interest rates
• Locked interest rate for the life of your loan
• Easier-to-understand loan terms and paperwork
Getting To Know The Federal Housing Administration
The Federal Housing Administration (FHA) is a government entity that offers mortgage insurance on loans made by FHA-approved lenders. The FHA provides insurance on mortgages for many different types of homes including single-family and multifamily homes. The FHA is completely funded by its own self-generated income, meaning there is no cost to taxpayers for its operation and services.
What Are FHA Loans?
FHA loans are insured by the Federal Housing Administration. These loans are designed to help first-time homebuyers and experienced homeowners alike by providing them with a low down payment option. FHA mortgage insurance serves as protection for lenders in the event of a homeowner defaulting on their home loan.
How FHA Loans Benefit You
FHA insured loans often give potential homeowners the option of making a lower down payment than they would need to make if using a traditional, non-FHA insured mortgage. FHA loan benefits include:
• Down payments as low as 3.5%
• Loan is guaranteed by the government
• Less than perfect credit can apply
• Energy-efficient mortgages, reverse mortgages, refinances, and renovation loans also available.
FHA Loans Benefit Everyone
FHA loans don’t just benefit the potential homeowner – they also are beneficial for the economy as a whole. They stimulate economic development in the form of expanding tax bases and creating jobs.
In fact, the FHA was created in 1934 as a direct response to difficulties in the housing industry such as unfavorable mortgage loan terms, low rates of homeownership nationwide and widespread unemployment among construction workers
Section 184 Native American Loan
First United Bank has done whatever it takes to help families realize their dreams of homeownership. And now we’re doing it again with the Section 184 Loans for Native Americans*. As one of the largest community banking organizations in America, First United has helped countless home buyers just like you get the best possible loan for their needs. As a HUD-approved Section 184 lender, we have the experience necessary to secure the loan you need at a competitive rate. The result is a loan that’s simple, fast, convenient and specially tailored to you and your investment.
• Low down payment
• No maximum income limits
• Low-cost closing options
• Down payment and closing assistance available
• Fixed rate loan
What Is A VA Loan?
VA loans are a special type of home mortgage reserved for active military members and veterans. These home loans are guaranteed by the U.S. Department of Veterans Affairs and offered by participating approved lenders. VA loans allow eligible veterans and active military personnel to realize their home buying dreams and help existing VA homeowners with money-saving refinance options.
VA Loan Benefits
VA loans are designed to provide long-term home financing to qualified veterans and, in some cases, their surviving unmarried spouses. In many instances, their interest rates can be better than other conventional loans.
VA loans offer a number of advantages over other types of mortgages, including:
• No penalty fee if you pay the loan off early
• No private mortgage insurance requirements
• Less than perfect credit can apply
• VA may be able to provide some assistance if mortgage payment problems arise
Who is Eligible For A VA Loan?
• Active-duty military
• Reservists and members of the National Guard
• Some surviving spouses of veterans
These eligibility requirements are unique to VA loans. In addition to past or present military service, standard home loan criteria like your credit score and income will also play a role in your eligibility.
Certificate of Eligibility
In order to apply for a VA-sponsored loan, you will need to obtain a Certificate of Eligibility (COE). Your COE verifies to lenders that you meet the requirements necessary to obtain a VA-sponsored loan. Applying for a COE is straightforward and can be done online, through the mail or through a lender.
Active duty military personnel and current National Guard members or Reservists who have never been Federal active service will need to present a current statement of service in order to obtain a COE.
Veterans and current or former National Guard members and Reservists that have been activated for Federal active service will need to present a DD Form 214 confirming their past service.
What Is a USDA Loan?
USDA loans are designed to encourage rural land development and growth in rural areas. They were long thought of as just for farmers, but the program has been expanded in recent years to give more people looking to purchase or refinance in a rural area access to the incredible benefits offered by these loans.
USDA Guaranteed Rural Housing Loans Applying for USDA Loans
First United Bank Mortgage offers USDA Guaranteed Rural Housing Loans. These loans are designed to help families without adequate housing finance the purchase of a home in a rural area. Applicants may have incomes up to 115% of the area’s median income and must be able to afford mortgage payments, including insurance and applicable taxes. Credit score is also considered in the application process.
The duration of a USDA Guaranteed Rural Housing Loan is 30 years, with an interest rate determined by the lender. No down payment is required, which sets these loans apart from more traditional home loans.
USDA Loan Eligibility
Program guidelines are very specific – but don’t let that stop you from achieving your homeownership goals. An experienced USDA financing professional at First United Bank Mortgage will help you navigate through the USDA loan process and determine if you are eligible.
Basic qualifications include:
• The property being purchased must be in a rural area as defined by the USDA.
• The property must be owner-occupied. Investment or vacation properties are not eligible for USDA loans.
• You must meet the income restrictions for the county the property is located in. Each county has a maximum income limit defined by the USDA. This maximum income limit depends on the cost of living, median income and other economic characteristics of the county the property is located in.
Benefits of a USDA Loan
USDA loans offer a number of unique benefits that set them apart from standard home loans. USDA loans require no down payment, so qualified individuals can finance up to 100% of the home’s total purchase price. This makes them one of the more desirable loans available to homeowners.
USDA loan benefits include:
• 100% financing option available
• Great rates and down payment options
• Better terms than a FHA or conventional loan
• Flexible credit guidelines mean less than perfect credit may still qualify
OHFA Advantage Loans
*OHFA Loans offered year-round at First United Mortgage – Muskogee*
It’s a great time to buy a home in Oklahoma! OHFA is here to help Oklahomans achieve their dreams of homeownership.
Designed for low-to-moderate income individuals and families, OHFA Advantage offers home loans through participating lenders all across Oklahoma.
Key features of an OHFA Advantage loan:
• 3.5% down payment grant assistance
• 5.0% down payment grant assistance
• 30-year, fixed rate mortgages
• Available statewide
• May be used for an existing or a new home
• Requires minimum credit score of 640
For a new construction, First United offers two different programs:
- Interim Financing of the construction loan followed by a permanent mortgage
- One-Time-Close mortgage that combines the interim mortgage with a permanent mortgage
Your Mortgage Loan Consultant can help you determine which product works best for you.
What options does FUBM have for renovating your current home?
When renovating your home, FUBM can combine the One-Time-Close product mentioned above with a refinance of your existing loan balance to allow for you to include renovations costs in a first lien mortgage. First United Bank also offers true home improvement loans that are typically 2nd liens designed to cover the costs of renovating your home. This product is done through the Bank Commercial Loan Officers.
What makes FUBM different from other banks offering construction financing?
At FUBM we offer all of the expertise of the construction process within the Mortgage Group along with very competitive products. From the beginning stages of approving the home project to the final stage of converting or modifying your construction loan into a permanent mortgage, the same Construction Lending Division handles your loan. This creates a consistent experience from the beginning to the end and sets FUBM apart from the competition.
You can get PRE-QUALIFIED before you select a builder.
SAVE MONEY: Your closing costs are greatly reduced in this streamlined transaction – a significant savings over two-time close programs, where you pay closing fees for a construction loan and again for a permanent loan.
CONVENIENCE: One application. One qualification. One underwriting. One approval. Go through the paperwork only once for your construction and permanent loans.
The one-time close program allows for the purchase of the lot if not already owned. We offer a VARIETY OF FINANCING PROGRAMS to choose from.
LOCK IN THE RATE BEFORE YOU START: The permanent interest rate can be locked and guaranteed before construction begins. This is especially advantageous if rates are heading up! Or, the Borrower may choose to modify or refinance to a different permanent loan product upon completion by meeting requirements.
PAY INTEREST ONLY DURING CONSTRUCTION: This interim interest is tax deductible.
DEAL WITH ONLY ONE LENDER: Simplify the home building process, eliminating uncertainty and reducing costs.
KEEP CONTROL: Buyer signs off and approves all advances to the builder.
Loan amounts up to $2 million.
Fixed- and adjustable-rate loans.
Low interest rates with attractive terms. We’re a community bank, so we can independently keep jumbo loan rates low.
Faster loan approval. Since our loans are all approved at the local level, we’re able to provide quick, efficient service so you won’t have to wait.
Available for single family homes, townhomes, condos. Primary residence and second/vaca on homes also eligible.