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A VA loan is a special mortgage option available through the US Department of Veterans Affairs for veterans, service members, and their surviving spouses to purchase homes with little to no down payment. VA loans also typically come without mortgage insurance and a competitive interest rate compared to other traditional or FHA mortgage options.
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Federal Housing Administration loans (FHAs) are backed by the government so that approved lenders can offer home finance to buyers who aren’t eligible for a traditional loan. FHA loans make first-time home loans and house ownership available to people who would otherwise not be able to afford them. They were designed for borrowers with a less-than-perfect credit rating but are today used by a broad range of people.
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USDA loans are part of the USDA Rural Development Guaranteed Housing Loan Program. This program was designed to make properties in rural areas more accessible to homebuyers with modest incomes. The USDA guarantees these loans, which means if a homeowner ends up defaulting on their loan, the USDA steps up. Because this reduces the risk to lenders, it may make it easier for you to get a mortgage if you meet the qualifications.
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A reverse mortgage is a category of loan that allows homeowners aged 62 or over to turn a percentage of their equity into cash. It can help people on a limited income to organize their retirement finances more effectively. With a reverse mortgage, you don’t have to make any mortgage payments while you’re living in the property. Instead, the lender sends you a regular sum. However, you do still have to pay property taxes, hazard insurance, homeowner’s association dues, and any other applicable expenses, as well as maintain the property.
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