What Are My Home Loan Options in Santa Clara County?

As a homebuyer, it is essential to do your homework and learn about the various mortgages available before buying a home in Santa Clara County. When buying in a high-cost area, you need to consider jumbo loans by RAS Loans.

With so many loan products available, first-time buyers may find it overwhelming to make a choice.

Borrowers need to understand that mortgages have different requirements that can impact your interest rate and the loan term. We dive deeper into some of the more popular choices, including Conventional, FHA, and Veteran loans, so that you can make an informed decision.

Conventional Loans

A conventional mortgage is one of the most common types of loans home buyers choose, with 75% of all home loans being conventional loans. A conventional loan is a good option when applying for a home loan in Sunnyvale, CA.

Lenders refer to conventional loans as loans that aren’t backed by the government.

Conventional loans come in 30, 15, and 10-year terms and are perfect for homebuyers with stable earnings which can afford at least 3% down and have good credit scores. 

Ask your mortgage lender about the current home loan interest rates in California.

FHA Loans

If you think that conventional loan credit score requirements are too strict for you or you may not have enough for a down payment, you can consider an FHA loan as one of your home loan options in Santa Clara County.

FHA loans are rising in popularity among borrowers, and one of the reasons behind this is that they allow buyers with a credit score as low as 580 plus a down payment as low as 3.5% to buy a home. You can still get an FHA loan for buyers with a 500 credit score as long as you pay at least 10% down.

To qualify for FHA loans, you should meet the following requirements:

  • A credit score of 580 and up (lower scores may still qualify with a 10% down)

  • 3.5% down payment

  • DTI or debt to income ratio of 43% or lower

  • 1 to 2 years of stable employment history

  • A property that meets FHA guidelines

  • A loan amount not more than 2022 FHA loan limits which currently stands at $420,680 in most counties

If you want to know if FHA can make you a homeowner, you can ask your San Jose mortgage broker to help you with the computations.

Veteran Loans or VA loans

VA loans are insured by the Department of Veterans Affairs and have less strict requirements than conventional loans. These loans provide flexible and low-interest mortgages for U.S. military veterans, service personnel, and their families.

You don’t need a down payment or mortgage insurance with VA loans, while closing costs are capped or may even be paid by the seller. This type of loan is tailor-fit for those who don’t qualify for conventional loans and have minimal cash savings.

Looking For The Best Home Loan Option in Sunnyvale?

We know that you’re excited to go house shopping, but before you do, you’ll need to know the right kind of loan for your specific needs to help you close the best deal.

RAS Loans helps Sunnyvale homebuyers choose the right home loan option based on their individual preference and requirements. 

If you need assistance in picking a personalized solution for your home buying needs, a Santa Clara County mortgage broker can help you determine the best one for you.

 


* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.