Buying a home is an exciting event and often one of the biggest financial decisions a person can make. Most buyers do not have the cash funds available to purchase a home outright. This is especially true for properties within and around Jacksonville as prices continue to increase, which is intensified by a limited inventory of homes in our area. Given the high price of real estate, many people wonder if they can afford to buy a home within Jacksonville. The good news is, there are many financing options available to homebuyers, which can make their dream home a financial reality. For this article, I teamed-up with Jessica Hickman, a Mortgage Loan Officer with Bank of the Cascades to discuss the different mortgage programs available to buyers. We used a higher-end home currently for sale in the Jacksonville area at 3667 Livingston Road, just outside of Jacksonville off Old Stage Road. It is listed at $956,000. Here are mortgage options Bank of the Cascades could provide a qualified buyer:
Conventional Fixed Rate: This option is available up to a loan amount of $417,000. Terms include 30, 20, 15 & 10 year loans with a fixed rate for the entire life of the loan. With today’s low mortgage interest rates, this is a popular choice as it provides ability to secure a great rate which translates into a better payment amount than you will find when rates are higher.
Adjustable Rate Mortgage (ARM) of 5/1, 7/1 or 10/1. Adjustable Rate Mortgages are 30 year loans which provide a fixed rate for the selected period of time of 5, 7 or 10 yrs. After that period of time, the interest rate on the loan then becomes adjustable once a year on the anniversary of the loan for the remainder of the life of the loan. The rate on an ARM can adjust up to 2% each adjustment for the remaining term of the loan. Payments are amortized over 30 years. We suggest you contact Bank of the Cascades directly for specific payment and loan term information.
Jumbo Loans: This option is for mortgage loan amounts over $417,000. Terms include 30 & 15 year fixed or an ARM of 5/1, 7/1 or 10/1 (see above description). The Jumbo loan option allows the borrower to finance up to 80% of the purchase price.
Non-conforming Loans: Non-conforming loans allow for more variations in a borrower’s income and credit profile. Terms include 15 & 10 year fixed rate loans or an ARM of 5/1, 7/1 or 10/1 (see above description). This option allows the borrower to finance up to 80% of the purchase price. Additionally, this option allows the borrower to add a 2nd mortgage (Home Equity Line of Credit) for a combined loan to value of up to 90% of the purchase price.
MDPAL: Medical & Dental Professional Assistance Loan. This option is available for licensed and employed Doctors or Dentists. Terms include Adjustable Rate Mortgage of 5/1, 7/1 or 10/1 (see above description). This option allows financing up to 100% of the purchase price. Health & wellness professionals (licensed or certified healthcare professional) can qualify for up to 90% of the purchase price on this program. No mortgage insurance is required on either scenario.
As a qualifying feature, all of the loan programs above have the additional feature of “Asset Dissipation,” which allows your liquid assets to be used as income without removing them from their current investment status.
Buying a home is significant financial decision. It is in your best interest to contact a mortgage loan professional such as those at Bank of the Cascades, to discuss the financing options available to you and the specific product terms, rates, and payments. Above all, the right loan will allow you to enjoy your new home for years to come.