Wanting To Know More About The Current Advantages Of An FHA And A Conventional Mortgage And To Tell Their Differences? California Platinum Loans Will Tell You More

Both FHA mortgages and conventional (non-FHA) mortgages have advantages and disadvantages. Contrary to some reports, you can find a conventional mortgage with a down payment lower than 20%, so you may be able to make a low down payment for an FHA mortgage or a conventional mortgage.

However, each mortgage loan program has advantages, so which are the strengths offered by FHA home loans, and which are the strengths offered by conventional mortgages?

What are some of the advantages of FHA home mortgages?

First, if you’ve got less than perfect credit, an FHA home loan could be your best option. Technically, FHA home mortgages are offered to people with credit scores as low as 500. In practice, most FHA home loans are offered to people with scores higher than 580. You will need a credit score of at least 580 to qualify for a 3.5% low down payment on an FHA home loan. With a score lower than 580, you will need to put at least 10% down.

FHA home mortgages are often touted by mortgage experts as the only alternative for home buyers with poor credit. They offer competitive mortgage interest rates. However, FHA home mortgages always come with a one-time mortgage interest charge when the loan closes. You will also pay monthly mortgage interest (MI) payments for an FHA mortgage, potentially for the entire life of the loan.

What are some of the advantages of conventional home mortgages?

One of the biggest differences between a conventional home loan and an FHA home mortgage is the mortgage insurance requirement. Not all conventional mortgages require mortgage interest. None of them charge a one-time mortgage interest payment the way FHA mortgages do.

Conventional home loans can offer more flexible terms. The biggest difference between conventional home loans and FHA home mortgages are the credit scores that are generally required to qualify. Few, to no, conventional home loans are available for borrowers with credit scores lower than 620. The higher your credit score, the more flexibility in underwriting and interest rates and terms you will find for conventional home mortgages. 

If you have a good credit score and are able to pay a bit more of a down payment than 3.5%, you may qualify for a 30-year fixed rate or a 15-year fixed rate home loan through an FHA home mortgage or a conventional home mortgage program.




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Thinking of Remodeling Your Crib Anytime Soon? Consider a HELOC or Refinance to Upgrade Your Home. Find Out Which Improvements Add the Most Value

Have you been thinking about updating or upgrading your home with a home equity loan, cash out refinance, or home equity line of credit (HELOC)? Every year, Remodeling Magazine conducts a survey of home remodeling projects that keep track of which home improvements can earn back your investment when it comes time to sell your home. While resale value isn’t the only reason you could want to upgrade your home’s appearance or amenities, before you sign your loan documents and get started with your remodeling project, you should probably know the types of projects that do add value, and be aware of the ones that don’t.

Which home improvements add the most to resale value?

According to Remodeling Magazine’s 2019 survey of home improvement projects, the average cost of a project was $63.4 thousand, and the average return-on-investment (ROI) was $37.5 thousand for 66.1% cost/value ratio. This comparison includes nearly every type of remodeling project you could think of, from master bedroom suite room additions to bathroom and kitchen remodels. 

None of the home remodeling projects surveyed have a 100% or greater return on investment, but the top improvement in 2018 and 2019 was an upscale garage door replacement. At an average cost of $3,611, the improved garage door returned over 97% at resale ($3,510). Replacing doors, windows, and entryways all averaged between 70% and 76% ROI.

A wood deck addition returned over 75% of its cost at resale, but composite decks: not so much. At an average cost of almost $20,000, they returned only about $13,200. 

If you’re thinking about doing your kitchen over, it’s worth considering the scale you’re willing to invest in. Major kitchen remodels costing over $130,000 returned less than 60% of their investment, while minor kitchen remodeling projects of about $22,000 came the closest to paying for themselves, at an 80.5% ROI.

You may be doing some remodeling projects for yourself, and your enjoyment of your home should always come first. Over the years and in general, home improvement projects that add more to the value of your home tend to fall in the “curb appeal” category, like landscaping, entry doors, window replacements, and new, upgraded garage doors. 

With home mortgage refinance rates expected to remain low for 2020, this year could be the time for you to consider making changes to your home. A mortgage loan and refinance professional can help you to find the right loan product to pay for your remodeling project.




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Thinking About Refinancing Your Home Loan This Year? Avoid Common Mistakes and Learn Your Choices

Have you been thinking about refinancing your home mortgage this year? Mortgage enterprises Fannie Mae and Freddie Mac, which buy most of the conventional mortgages from lenders, predict continuing low interest rates throughout 2020. If you refinance your 30-year fixed rate or adjustable rate mortgage (ARM), you could lower your monthly payments, reduce the total amount of interest you pay, or potentially take cash out of the equity in your home to achieve financial goals, pay for education costs, or do home improvements.

It may seem like a big change to refinance your mortgage, but if you can reduce your mortgage interest or monthly payment, it could be a sound financial choice. And it is your choice. Did you know that in Canada, mortgages are refinanced every five years whether the owners want to refinance or not? 

Instead of having to refinance every five years like they do in Canada, here in the U.S., you don’t have to refinance at all. Instead, you can take time to review your financial options and decide when and how to refinance your home mortgage. So, what are some of the reasons you might want to refinance your 30-year fixed rate or 15-year fixed rate home loan? 

  • Lower your monthly mortgage payments
  • Lower your mortgage interest rate
  • Change your loan type or program
  • Eliminate mortgage insurance
  • Get money for home improvements or repairs
  • Pay off high interest debt
You have many choices to refinance your home mortgage, and you can achieve a variety of financial goals through refinancing. At the same time, it’s important to understand how refinancing will impact your finances.

Some of the factors that can affect the total cost and long-term impact of mortgage refinancing can include:

  • How long you’ve lived in your home
  • How much debt you have and what type (student loans, credit cards, medical debt)
  • Closing costs
  • Mortgage prepayment penalties
  • Your credit score
  • Equity in your home

Every financial situation and refinancing is unique, and you can prevent mistakes and make the right financial decisions by working with an experienced home mortgage refinancing professional. Not only can they offer you a choice of lender and mortgage refinance programs, they can tell you about opportunities you may not be aware of and spend the time needed so you can make a fully informed and wise refinancing choice.




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