Owning a home is a dream come true for anyone in Virginia. Apart from being a strong financial asset, a home also conveys a sense of freedom. However, all these freedoms, dreams, and financial gains come at a price. You can click on this link teampierocornejo.com/prestamos-convencionales/ to apply for the conventional home loan.
The lenders offer home loans and hold the property as collateral until the loan is repaid. If the borrower does not repay the loan, the house can be taken. Some types of conventional mortgages are as follows:
* Fixed rate mortgage: With this type of mortgage, the interest rate is fixed over the term of the loan and does not vary depending on fluctuations in market indexes. It is less risky and more stable. The term of the mortgage can be 15 or 30 years. The interest rate is higher when the mortgage term is lower and vice versa.
* Adjustable Rate Mortgage (ARM): With this type of mortgage, the borrower enjoys a fixed rate of interest for the first period. Then the price varies depending on the market index. The initial fixed term can vary from a few months to 5 or 7 years. This type is only ideal for short periods of time.
* Balloon Loans: These are short-term mortgages that offer a loan at a fixed rate and allow a person to make small advance payments. After this period, the borrower must repay the remaining amount in one payment.
* Equity Mortgage Loans: These allow borrowers to withdraw funds from equity in the home or property. This mortgage can be fixed or variable.