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Assumptions
Conventional
The rate advertised is based on a 30-day rate lock for the purchase of a $500,000 single-family detached residence in NC that appraises for $500,000 for a hypothetical client with a 780 qualifying FICO (credit) score who is borrowing $400,000 on a conventional, 30-year, fixed-rate mortgage, who owns no other properties, and who is escrowing their property tax and insurance payments.
Given the current rate environment, most conventional borrowers are putting more down and have generally higher FICO scores. However, that does not mean that every conventional loan will look like this. This is just a relatively common scenario we see advertised, and it is important for you to make an educated decision, so we provided the same.
FHA Home Loan
The rate advertised is based on a 30-day rate lock for the purchase of a $350,000 single-family detached residence in NC that appraises for $337,750 for a hypothetical client with a 740 qualifying FICO (credit) score who is borrowing a base loan amount of $337,750 on an FHA, 30-year, fixed-rate mortgage, who owns no other properties, and who must escrow their property tax and insurance payments. Please note that there is an up-front mortgage insurance premium (UFMIP) of 1.750% that is paid to the Federal Housing Administration that can be wrapped into the loan amount. For sake of transparency, we have disclosed the APR reflecting the fee wrapped into the loan amount (which is the most common scenario).
Most other companies will take the exact same scenario of their conventional loan and provide a quote for an FHA loan. That is non-transparent. Statistically, FHA borrowers have higher loan-to-value ratios and may have slightly lower FICO scores which is totally fine with us. Lenders should be accurately providing a competitive quote based on what a typical borrower’s financial profile represents, and that’s what we do. There are actually a lot of scenarios in today’s rate environment where an FHA loan is the best financial option for a client even if they may qualify for a conventional loan as well.
VA Home Loan
The rate advertised is based on a 30-day rate lock for the purchase of a $500,000 single-family detached residence in NC that appraises for $500,000 for a hypothetical veteran qualifying client with a 740 qualifying FICO (credit) score who is borrowing a base loan amount of $500,000 on a VA, 30-year, fixed-rate mortgage, who owns no other properties, and who is escrowing their property tax and insurance payments. Please note that based on your use type and VA disability status, you may or may not have a VA funding fee that is paid to the Department of Veteran’s Affairs. For sake of transparency, we have disclosed the APR reflecting a first time use active-duty funding fee of 2.150% being wrapped into the loan (which is the most common scenario).
This is another situation where a typical VA client will not see lenders being transparent. Similar to an FHA loan, most lenders will disclose the exact same scenario as a conventional loan. This makes no sense when a VA loan has an extensive number of benefits that make VA loans (in nearly every circumstance) a much better loan for veteran borrowers. The most common being that qualifying veterans can obtain 100% financing when buying a home. Not only is this an excellent benefit, it is also the most common situation that VA borrowers consummate their loans. With that fact in mind, why would any company then advertise a client paying a 40% down payment when they are very likely going to be putting much less down? We pride ourselves in our wide-ranging experience with VA loans, and advertise what veterans actually close on, not what makes them click a page.
Jumbo Loan
The rate advertised is based on a 30-day rate lock for the purchase of a $1,450,000 single-family detached residence in NC that appraises for $1.000,000 for a hypothetical veteran qualifying client with a 740 qualifying FICO (credit) score who is borrowing a base loan amount of $1.000,000 on a VA, 30-year, fixed-rate mortgage, who owns no other properties, and who is escrowing their property tax and insurance payments. Please note that based on your use type and VA disability status, you may or may not have a VA funding fee that is paid to the Department of Veteran’s Affairs. For sake of transparency, we have disclosed the APR reflecting a first time use active-duty funding fee of 2.150% being wrapped into the loan (which is the most common scenario).
Disclaimer
Please note that none of the information found on the site or on this page is to be construed as an offer to extend credit, or as a commitment to provide a loan. This website is provided solely for informational purposes. The accuracy of the information is not guaranteed, either expressly or impliedly. Approval of a loan is contingent upon the completion of a full loan application, underwriting procedures, ID verification, property appraisal, clear and marketable title, and successful consummation of the loan. Not all applicants may qualify for approval. Certain restrictions may apply.