Home Financing for Phoenix Home Buyers

Financing Options in the Phoenix AreaPurchasing a home? Serious buyers in the Phoenix area have considered their home financing options prior to choosing their dream home. They’ve know how the new mortgage payment will fit within their budget, have discussed the current market trends with a reputable real estate agent, and know all of the financing possibilities available to them. Let’s take a few minutes to think through some of those options.

Fixed Rate Mortgage

With a fixed rate mortgage the combined payment on your principle and interest remain the same through the course of your loan. The only situation wherein your bottom line may increase or decrease is when your insurance and taxes are included in the loan. The fixed rate mortgage is your best option when a constant mortgage payment is important to you.

Adjustable Rate Mortgage Loans

As interest rates rise or fall in the marketplace, adjustable rate loan payments increase or decrease. The advantages of this type of loan, though, include lower monthly payments when interest rates are low and lower monthly payments at the outset of a loan. It is extremely important to consider the cap of such a loan before you choose this option. However, many choose this option when planning to stay short term in the purchased home.

FHA Loans

Their website states that the Federal Housing Administration (FHA) has “been helping people become homeowners since 1934.” The down payment on this type of loan is sometimes as low as 3.5% of the purchase price. The benefits of this type of loan include:

  • Lower Mortgage Insurance
  • Controlled Loan Costs
  • Lower Financing Qualifications

With many of your closing costs and fees included in the loan, the low interest rate, and lower mortgage insurance, FHA loans continue to be a viable option when considering the purchase of a home.

Seller Financed

When a seller owns their home free and clear of a mortgage, they are in a better position to consider options that wouldn’t otherwise be open to them. One of those options is a seller financed loan.

In this type of transaction, the seller and buyer agree upon the terms of the loan, the interest rate, and monthly payment. Buyers with “less than perfect credit”, or who find that they don’t meet the stringent standards of a conventional lending institution, might qualify with the right seller financed loan.

VA Home Loan

The Department of Veteran Affairs guarantees loans with qualified lenders for veterans of the armed services of the US. Through this program, veterans with qualifying income and credit can purchase their primary residence with no money down. Additionally, the benefits include no pre-payment penalties and only limited closing costs.

Lease Purchase

In our current economy, it’s more crucial than ever for sellers to consider all options. In a lease purchase, the buyer benefits from the sellers options. Arrangements are made for buyers to lease the property with an option to purchase within a specified time. “Lease with the option to purchase” combines a lease contract with an option to purchase contract.

A lease purchase works in situations where the buyer doesn’t quality for financing. However, they do see a situation a few years down the line where they would quality. In this case, and with the right sellers, the property is leased with the intention to buy within a specified period of time.

How Can We Help?

More than ever, experienced realtors need to know the options open to their buyers when considering financing. With a knowledgeable buyer’s agent in the Phoenix area, you know your options. My “think outside the box” attitude makes me the perfect choice as your buyer’s agent.