With plenty of desirable, sought-after Portland homes for sale, it stands to reason that you may be looking for a Portland mortgage company as well. But, do you know your mortgages?
There are many options available to the Portland home buyer, with pros and cons to each variation. Therefore, it’s important to do your research to ensure your perfect home is covered with the perfect mortgage for your particular circumstances.
It can be confusing when researching mortgages from many sources, from different parts of the country online. So here, you will find the differences between your mortgage loan options from your trusted Portland mortgage lender.
You will benefit from the knowledge and understanding of what type of Portland home buyer you are and how to benefit from the mortgage loans for your situation.
Understanding your lending options is critical to success, and wisely, buying a new home.
It can be easy to opt for conventional methods when it comes to lending options simply because that’s all you have heard of. Sometimes, this can lead to deciding against owning your own home entirely – this needn’t be the case.
It is not uncommon for individuals to have not realized that there was a better-suited option on the market until it’s too late. While mortgage options can be a minefield with a lot of jargon or buzzwords, the Tammi Lindley Team is committed to offering clear and suitable choices so that successfully obtaining your Portland mortgage is as smooth sailing as it can be.
So, as broad as your options are, read on to determine which may suit you better. There may be mortgage loans that you didn’t realize you could benefit from, and the many mortgage options available could open the window of opportunity in becoming one step closer to buying that dream Portland home.
Government Home Loans Explained.
The government introduced home loan options to individuals that may have difficulty in financing homeownership.
The Federal Housing Association (FHA) offers a loan program for those whose credit might otherwise struggle, or perhaps can only save a smaller down payment proportion, such as 3.5% of the purchase price, instead of the typical 5 or 6 percent. In addition, that 3.5% down payment can be gifted to you.
Perfect for the first-time homebuyer and applicable for a seasoned homeowner, ask yourself whether you fit potentially qualifying for the FHA Loan option.
- Small down payment available
- Gifted a down payment
- Credit might struggle to meet traditional mortgage options
The US Department of Veterans Affairs (VA) loan program assists American veterans, military members currently serving in the U.S. military, reservists, and select surviving spouses (provided they do not remarry) in financing their homes.
Traditionally, applicants who meet their guidelines often qualify for larger loan amounts and benefit from their insured payments.
Other benefits include interest rate reduction, zero down payment options, cash-out purposes, and also used in a refinancing transaction.
Does the following sound like you?
- One of; American veteran, currently serving in the US military, a surviving spouse of an American veteran and have not remarried (list not exhaustive, always check your eligibility)
- Could be looking for a larger loan amount
- Interested in zero down payment, cash-out, and refinancing options
USDA Rural Development Loans
Aiming to improve the quality of life and boost the economy in rural America, the USDA Rural Developments program helps owners or home buyers within qualifying areas, offering benefits such as zero down payments and, if you’re looking to refinance, up to 102% of the value of the home on such transactions.
Even homes in City Limits can potentially qualify under this program, so it’s worth discussing with The Tammi Lindley Team to see if your home or your potential new Portland home could qualify.
- Down payments are zero to low.
- Interested in refinancing
- Home qualifies within a Rural area as set out by USDA RD
Reverse Mortgage Loans
If you’re 62 years or older, then the Reverse Mortgage could be for you.
Withdraw equity to use as you like; perhaps you wish to travel in your retirement years or would prefer a new kitchen, you can do it. When you’re ready to sell the home, the loan is then repaid.
Drawbacks include remembering that the beneficiary should know that the loan is still due if your home is sold after your passing. It’s also important to account for non-borrowing co-inhabitants such as children, what should happen to their home once your loan is due, for example.
Should you have a co-borrowing owner such as your legal spouse, they may be able to continue withdrawing equity as long as they qualify to do so.
Advice must be sought when others are involved in the home and opt for a reverse mortgage loan. Speak to The Lindley Team today to schedule a call when thinking about your Portland mortgage.
- Suitable for age 62 years and older
- Withdraw equity and use it as an income during retirement
- The loan is due once the house sells or the mortgage holder dies.
- Potential impact on beneficiaries or those living with the mortgage holder
Home Loan Programs Explained
Portland home buyers wanting to look into traditional financing have many options at their disposal to best suit their needs.
The most traditional and popular options include Fixed-Rate Mortgages, Adjustable Rate Mortgages, Conventional/Conforming Loans, and interest-only loans. All of these are explained here.
The interest rate is fixed throughout the entire loan term, typically 15 or 30 years, the interest rate is fixed, and your payments are calculated based on this rate being applied.
This will mean that should there be a financial crash; you would not benefit from the lower interest rates available to others. Likewise, should the market boom and interest rates increase, you will be secure in the knowledge that your monthly payments will not suddenly rise, which could otherwise potentially bring financial difficulty.
The predictability of knowing exactly what your payments will be every month of the entire loan term can enable you to budget more effectively.
- Fluctuating interest rates have no bearing on your monthly payments, positively or negatively.
- Confidently budget for years ahead
- Predictability gives greater peace of mind
Adjustable-Rate Mortgage (ARM)
Simply put, an ARM means that your due payments can be affected throughout your loan term as the interest rate may change.
Carrying a lower monthly payment towards the beginning of the mortgage length, your payments are likely to fluctuate throughout the entire term, meaning you could either pay more or benefit from economic growth and/or downturns.
If you’re struggling to access a fixed-term longer-length mortgage, then ARM’s are more easily accessible, meaning first-time buyers have a better ability to jump on the property ladder than without. A prime candidate for the Adjustable Rate Mortgage could also expect their income to increase and, therefore, is already thinking ahead to refinance before their introductory rate adjusts potentially.
- An attractive option for shorter length mortgages or if looking to refinance in the near future
- Beneficial introductory rates often offered
- First time home buyers or short-term homeowners
- Be prepared for fluctuation should this be your long term mortgage option
In simple terms, the Interest Only Mortgage option offers the benefit of repaying only the interest payments each month. In other words, payment on the home’s principal balance is not due until the mortgage period is up.
Whilst this can offer a significantly lower monthly payment, the principal balance will need paying in full at the end of your mortgage term. However, if you’re expecting to sell your home (and not be in negative equity) before the interest-only mortgage term’s end, or you are confident that you will have the cash readily available. This mortgage could be worth looking into.
Typically, these mortgages are better for the short-term – up to 10 years, as anything can happen during a greater time period. In addition, you should certainly be aware that none of your mortgage payments are going towards your Portland homeownership, although there are options that mean you can top up your monthly payments, which allow for this.
Make use of scheduling a call with the Tammi Lindley Team to discover whether this type of mortgage is what you need, but you may find the below stand-out points relevant to you.
- Ideal for shorter-term mortgages
- Be confident that the property will increase or maintain its equity
- Smaller monthly payments that may fluctuate
If you’re planning to apply for a mortgage as a Portland home buyer, the typical conforming loan limit is at or below $453,100 with Washington and Oregon mortgage companies. This is for a Single Family Residence.
It goes without saying that assets, income, credit, and debt ratios are considered throughout the mortgage application process. Still, in most states, the loan amount must not exceed $484,350 for a conventional or conforming loan.
- A traditional loan that is within FHFA limits
If you’re looking at requiring more of a loan limit, then Jumbo Loans are explained below.
Jumbo Loans Explained
Non-conforming loans, or Jumbo loans, are applicable should you seek a loan limit higher than that the Federal Housing Finance Agency (FHFA) has in place for your area.
Should you be looking for a higher-than-standard loan limit for your Portland mortgage, this could be for you. If you have recently started a business, for example, then as long as you can prove that it is stable and growing, lenders may only require one year of filed returns instead of two or more when applying for more conventional mortgage options.
Typically a slightly higher interest rate due to its higher risk, there is greater flexibility in how your income, assets, and credit are weighed. Where lower down-payments can apply, be prepared for higher down-payment requirements as well.
Schedule a call today with the Tammi Lindley Team to discuss your thoughts, or use the mortgage calculator to explore your potential monthly payments for your potential Jumbo Portland mortgage.
Portland Mortgage Refinancing Options
Every Portland resident is always looking to maximize their return on investment, especially when it comes to their own property, which is why refinancing options are useful and plentiful.
Using swift and simple mortgage analysis, you can unleash great opportunity and discover whether refinancing is right for your circumstances, within minutes and with no up-front costs with the Tammi Lindley Team.
Whether you’re thinking of a holiday, a new car or general home improvements, or even high-interest debt consolidation, mortgage refinancing will lower your monthly payments while allowing you to benefit from freeing up your cash flow.
Maybe you’re close to the end of your introductory rate benefits of an adjustable-rate mortgage, and you’re looking to change to a fixed-rate mortgage, locking in a current low rate of interest for a longer-term mortgage, up to 30 years.
Has your income changed, or your personal circumstances in general? Refinancing opens up a whole host of benefits that the Tammi Lindley Team can guide you through and enable your Portland mortgage hopes aspirations to come to fruition.
- Reduce your current monthly payments
- Enrich your cash flow to do what you want or need
- Lower your monthly payments
- Lock in a low, longer-term interest rate fixed for up to 30 years
- Switch from an Adjustable Rate Mortgage before the initial benefits run out
- Your financial standing has changed, and you’re looking to move in line with it
- Remove costly mortgage insurance
Get to know Portland as much as possible before deciding on your final mortgage option as a Portland home buyer. Then, once you’ve settled on the neighborhood of choice, you can be sure that the Tammi Lindley Team will be there for you, assessing your circumstances, your needs, and your very best options in line with all of your financial aspirations.
The highest reviewed team on Google in the Portland area, you can be confident that your questions, concerns, and dreams will be realistically answered when it comes to becoming a Portland home buyer. So get in touch today and see where it takes you.
If you need home financing or have any questions about the lending process, please visit our website and contact us today for more information.