Colorado Home Loan Programs

Purchasing a home in Colorado is a wonderful and exciting venture. Your home will be unique – just like you; your loan process should be just as unique.

All home loans are not created equally. Securing the right home loan for you and your family is vital to making your purchase process as cost-effective and effortless as possible. Banner Mortgage will work with you to determine which loans you may qualify for, and which loan type might be best for your unique situation and goals. If you’re the type of person who likes to learn the details of each loan type, we have provided a comprehensive list below. If you have any questions or would like to learn more about any of the programs below, please do contact Banner Mortgage today! (303) 646-2466.

FHA/VA Loans:

Follow this link for the 2015 FHA Guidelines.

These loans provide mortgages that are insured or guaranteed by the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA), and offer buyers a “basic” mortgage with lower upfront costs. These government backed mortgages provide security to the banks that if for some reason you’re not able to fully repay the loan, the FHA or the VA will pay the bank instead. This means the lender may be more willing to approve a loan application in situations where they might not have otherwise.

Benefits to an FHA or VA Loan:

  • Lower or NO down payment! FHA loans will allow you to purchase your home with as little as 3.5% down payment. (down payment assistance available – some restrictions apply)
  • VA loans for honorably discharged service members that qualify requires no down payment!
  • No pre-payment penalty! When you work hard to pay off your mortgage quicker, you won’t be penalized
  • Assumable! Another buyer can “assume” or “take over” your loan where you leave off.
  • A Second Chance! If you’re coming out of a bankruptcy or foreclosure (usually two-three years out), an FHA or VA loan will typically be much easier for you to qualify for
  • No income limits!
  • Generally, you’ll need a 31/43 debt to income ratio
  • Credit scores can be lower – as low as 580 with a 3.5% down payment (some restrictions apply)

Restrictions:

  • Mortgage Insurance Premium: These government loans require you to pay an upfront mortgage insurance premium to insure the lender against loss in cases of default
    • There will be an upfront MIP cost and ongoing MIP cost, which is added to the loan amount.
  • Less variety: These loans are designed to serve a basic need for those looking for long-term home ownership. If you’re looking for options in your loan, these may not be best for you.
  • For VA loans, must provide a DD-214 showing an honorable discharge from the armed forces, or a current honorable status as an active duty military service member.

Each situation is unique, so contact us today see if you qualify for a FHA home loan or a VA Home Loan today!

VA Jumbo

For those who need a larger mortgage, but still want the convenience of having a VA-backed loan. Similar to the VA loan above, this loan type provides qualified buyers with the convenience of lower down payments and other benefits. However, this loan type is for buyers who wish to purchase a property above the conforming loan limit.

Benefits to a VA Jumbo Loan:

  • No loan size limits!
  • No pre-payment penalty! When you work hard to pay off your mortgage quicker, you won’t be penalized.
  • No Prepaid Mortgage Insurance (PMI)! VA Jumbo loans, unlike their non-Jumbo brothers, do not require PMI. 

Restrictions:

  • The buyer will likely be required to make a down payment. This payment will represent the amount over the “entitlement amount” that the VA does not guarantee. For instance, if the entitlement amount is $417,000 and you wish to purchase a $500,000 property, you’ll have to pay $20,750 upfront. That’s because the VA will guaranteed up to 25% of the $417,000 entitlement amount. So for the difference of $83,000 ($500,00 – $417,000) must be “covered” by the purchaser. 25% of $83,000 is $20,750. This down payment is still much lower than a typical loan’s 10% down payment requirement.
  • Interest rates are usually lower than conventional VA loans. VA loans have the lowest interest rates even on Jumbo.
  • VA Jumbo loans do not require a higher credit score
  • Must be an honorably discharged veteran, and able to provide a DD-214 stating discharge status OR an active duty service member.

Each situation is unique, so contact us today see if you qualify for a VA Jumbo Loan today!

Renovation Loans – FHA & Conventional Loans

Renovation loans allow property owners to borrow based on what the house is expected to be valued at after the home rehab is complete. Perfect for owners who are looking to change and improve a property, or those buyers who want to buy homes and customize to their liking. Typical benefits and drawbacks apply to Renovation loans based on whether it is an FHA or conventional loan.

Benefits to a Renovation Loan:

  • You can borrow well above the current value of the home.
  • Unlike credit lines, these renovation loans require borrowers to show the money was spent on the property.
  • You do not have to tap into your home equity.

Requirements:

  • A consultant must be hired to assess the construction plan and preform an inspection before each “draw” is made. A “draw” is when a portion of the borrowed money is disbursed to the contractor. Buyers are allowed up to five “draws” per project.
  • The project must be completed within a six-month timeframe.

Each situation is unique, so contact us today see if you qualify for a Renovation Loan today!

USDA Loans or USDA Rural Housing Loan

Specialty loans tailored just right for those who live in rural areas and meet household income guidelines. Your dream is to live quietly away from the noise and distraction of the city. You love a life free of distractions and a life that is simplified. Your loan should mirror that lifestyle. Moderate requirements allow you to focus on what matters most to you.

Benefits to a USDA/Rural Housing Loan:

  • No down payment! Don’t let upfront cost barriers stop you from living the rural life you dream of.
  • No maximum purchase price limits! Buy the home of your dreams and live the life you want. Your loan will need to meet qualifying ratios to determine affordability.
  • Flexible credit guidelines! Non-traditional credit histories won’t hold you back with this type of loan.

Requirements:

  • The purchased property must be within eligible rural areas
  • Household income limits will apply to qualify for this loan
  • The property must be a primary residence and the borrower may not own another home within commuting distance of the purchased property
  • The USDA asses a 2% mortgage insurance fee (though this can be added to the loan size at the time of closing).
  • .50 % MONTHLY USDA FEE

Each situation is unique, so contact us today see if you qualify for a USDA Rural Loan today!

 

HARP Refinance Home Loans

If you’re not behind on your mortgage payments, but your declining home value hasn’t allowed you to refinance, you may be eligible to refinance through the Home Affordable Refinance Program (HARP). HARP is designed to get you into a stable and affordable mortgage so that your homeownership dreams can continue.

Benefits to a HARP Refinance:

  • Lower your monthly payment
  • Reduce your interest rate
  • Get a fixed-rate mortgage
  • Build equity faster and start saving money for the long run!

 Requirements:

  • You must be in good standing with your current mortgage meaning you must not behind on payments, nor have had late payments in the last 6-12 months
  • Your mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae and it must have been sold to them on or before May 31, 2009
  • The current loan-to-value ratio must be greater than 80%. For instance, if you owe $100,000, your home must be valued at less than $80,001

Each situation is unique, so contact us today see if you qualify for a HARP Refinance today!

Manufactured / Modular Home Loans

Ready to have a modular home built? You’ll need a special kind of loan since there will be periodic payments made as work is completed. When you’re ready to build your home, you’ll use this type of “construction loan” or “short-term loan.” This loan will provide a series of payments as work is completed. Once the local building inspector issues a certificate of occumpancy and the lender agrees that the home is essentially complete, the lender pays off the construction loan and issues you a mortgage.

Benefits to a Manufacture/Modular Home Loan:

  • Build your own home to your specifications!
  • Acquire a home loan that will help pay for construction and general contracting costs.
  • Costs are typically much lower than traditional houses.

Requirements:

  • Loans for manufactured homes can be FHA or Traditional loans and carry the same requirements

Each situation is unique, so contact us today see if you qualify for a Manufactured/Modular Home loan today!

 

Streamline Refinance

Qualifying for a traditional mortgage refinance is harder now that in the recent past. However, a streamline refinance can make your dreams of reducing costs on your current mortgage possible. This home loan is literally streamlined to make the process easier, takes out a lot of the legwork and usually increase your chances of being approved.

Benefits to a Streamline Refinance:

  • Convert adjustable-rate mortgages to fixed-rate mortgages
  • Minimal credit requirements
  • Lower closing costs
  • Faster processing
  • Less paperwork
  • No appraisal necessary
  • Available in FHA, VA, or Conventional Home Loans

Requirements:

  • You must be current on your existing mortgage
  • The refinance must clearly benefit the borrower and provide a “net tangible benefit”
  • Certain time requirements since the origination of the loan may be applicable

Each situation is unique, so contact us today see if you qualify for a Streamline Refinance today!

 

Conventional Loans

Conventional loans include any loan for a mortgage that is not insured by a government program. Conventional home loans do not carry the stipulations and requirements that many other types of loans do and therefore are a great choice for basic mortgage processes.

Benefits to a Conventional Loan:

  • Less regulations and stipulations than Government-backed loans
  • Many more options! From a 1-month ARM to a 30-year fixed loan, you’re in the driver’s seat with conventional loans
  • No loan limits (for non-conforming)
  • No mortgage insurance requirements or premiums
  • High rates of availability! If you prefer to go with a bank you’ve trusted for years, you can almost guarantee that they’ll offer a conventional loan
  • Almost all properties are eligible

Requirements:

  • Interest rates are determined on credit scores – so they could be higher than other loan options
  • Closing costs and down payments are typically higher. Down payment requirements can be as high as 20% of the home value.
  • Qualification requirements are often more strict and belong solely to the lender

Each situation is unique, so contact us today see if you qualify for a Conventional Loan today!

 

Refinance Loan vs. Purchase Home Loan

The biggest difference between a purchase loan and a refinance loan is that the borrower usually doesn’t have to pay for closing costs out of pocket.

Here are some quick facts:

  • On a purchase the interest rate is the same up to 95% loan to value. On a refinance the rate may vary based on whether you take cash out in addition to paying off the current first mortgage.
  • You can take cash out for any reason on refinances – to consolidate debt, to make home improvements, to make a large purchase, or to put money in the bank
  • Seasoning: Seasoning is when a first mortgage and a second mortgage are combined into a first mortgage.
  • An appraisal is usually required to assess the home value.

Ready to purchase or to refinance? Contact us today!

Large Acreage

For large parcels of bare land with a home on them, Large Acreage loans are perfect. These loans are not for agricultural or commercial purposes. If you’re a hobby farmer (where the primary income is not derived from your property), or your home sits on a large plot of land, this loan could be right for you.

Down payments, terms, and rates vary based on your equity and your short or long-term plans for the land. With so many options on land loans, contact us today and let us find the best loan for your unique situation.

 

Construction-to-Permanent Loan

For those that dream big! If you refuse to settle for something that someone else dreamed up, a Construction-to-Permanent Loan may be right for you. Do you want to literally build your dream home from scratch? Or, do you want to take the home you have and add onto it to make it into your dream home? Whether building from the ground up or launching into a major renovation, this loan might be what you’re looking for to make your dreams a reality.

Benefits of a Construction-to-Permanent Loan:

  • Interest-only payments during construction
  • Fixed construction interest rate
  • Fixed rate and adjustable rate loan options
  • No prepayment penalties
  • One-time closing and one set of costs at closing

Eligibility Requirements:

  • The home being built must become your primary residence or vacation home
  • The home must be a one-unit, single-family, detached home
  • The builder must be a licensed contractor

Ready to get started on creating the home of your dreams? Contact us today!

Fixed Rate vs. Adjustable Rate

These two terms refer to the interest rate that will apply to your mortgage. Fixed rate means just what it sounds like – the rate you set when you take out the loan is fixed at one amount. Adjustable rate mortgages (commonly referred to as ARM) means that your interest rate may go up or down dependent upon the market. The adjustment of the interest rate you pay on your mortgage is tied to a broader measure of interest rates, called an index. If the index is higher, your interest rate – and thus your payment – will go up. Fortunately, when the index is low, you benefit from lower interest rates and a lower payment. Sometimes an ARM loan will start at a very low rate for a particular period of time. However, once that “introductory” period is over, your rate will flex with the index. Additionally, ARM’s sometimes have caps on how high they’ll go, or limits on how low they’ll fall.

A Fixed Rate Loan may be best for you if:

  • Your budget is set and you don’t want any surprises.
  • You are a buyer who wants to understand everything about their loan.
  • You don’t have the time or wish to shop around – fixed rate loans are typically comparable from lender to lender.

An Adjustable Rate Mortgage (ARM) may be the right fit for you if:

  • You want to take advantage of falling rates without having to refinance.
  • You are looking for a lower rate and payment early on in the loan.
  • You don’t plan on living in the same place for very long.
  • Your budget allows for some flexibility if the index raises.

Both loan options come with their own eligibility requirements and pros and cons. To learn what is really best for you and your financial goals, contact us today!

Horse Properties

Although a horse may be part of your family, finding the right loan for a horse property is not as easy as finding a standard home loan. Horse properties, and thus loans to purchase them, are complicated for lenders who aren’t versed in the intricacies – lucky for you, we know horse properties. More than just a home on a substantial size lot, a horse property may have amenities such as a stable, tractor barn, indoor rings or extensive turn outs. Unfortunately, lenders are often reluctant to offer loans on these properties without many comparable properties (or “comps”) to assess your property’s value against. So the beautiful barn, with a heated tack room and running water, may be seen as an additional outside building, and thus valued lower. If you’re ready to purchase or build a quality horse property, you’ll want a knowledgeable lender on your side. Contact us today to see why our familiarity in this niche area can help you acquire the horse property you’ve always wanted.

 

Farm Loans

The heart of America lies in our farmers. You work hard every day to provide for your family – you shouldn’t have to work at getting a loan. Whether you are buying a farm, expanding your operation or making long-term improvements, we are here to help you every step of the way with a Farm Loan that fits your unique situation. You’re not buying “just a house” or “just land” – you’re buying a dream. Contact us today and we’ll help that dream come to life.

2nd Home Loans

Mountains or Beach? City or Country? Warm year-round or all four seasons? You’ve worked hard so now you don’t have to choose. When you’re ready to have the get-away home to escape the buzz of the city or a cozy beach-front property to escape the bite of winter, a second home loan might be the fit for you. Many of the traditional home loan options will be still be available for you to purchase your second home; however, with a second loan –any other loan – has specific criteria that must be met. With a second home loan, your debt-to-income ratios and credit score will be even more heavily scrutinized than with your first home loan.

Other qualifications are:

  • The purchased property must be a reasonable distance, generally 60 + miles or different type of property than current owned or closer commute to work away from the borrower’s principal residence.
  • The property must be occupied by the buyer for 6 weeks per year.
  • The property must be suitable for year-round occupancy.
  • The property must be a one-unit dwelling and cannot be a rental or timeshare.

Contact us today– because you shouldn’t have to choose between the mountains and the beach – you deserve both!

Jumbo Loans (Non-Conforming)

For home purchases that don’t conform to the limits of traditional home loans. Larger properties, properties with the latest amenities, and those that are in the neighborhood of your dreams – all could be priced above the “mortgage conforming limit”. This limit is set at $417,000 for most parts of the country, but can be as high as $625,501 in some areas. If the home your family wants to live in is priced above the conservative loan limit, a Jumbo Loan could be right for you.

Benefits to a Jumbo Loan:

  • You’ll be able to purchase the home of your dreams – without purchase price limits.
  • No private mortgage insurance requirements.
  • Flexibility in type of loan.
  • With a higher interest payment, your tax benefits will be more extensive

Eligibility Requirements:

  • The down payment on the loan may need to be at least 20%
  • Your income and credit score will be more heavily scrutinized
  • Your debt-to-income ratio will need to be 43% although we have seen approval for up to 46%

Jumbo loans for Jumbo dreams! Contact us today to see if you qualify for a Jumbo Loan today!

Investment Property

Savvy investors know that real estate offers great opportunities for additional income. If you’re ready to take the steps towards your own investment property, this loan may be right for you. With more leniency than a second home loan, this loan allows you to purchase multi-unit properties and doesn’t require that you reside on the property.

Benefits to an Investment Property Loan:

  • Realize your investment dreams
  • Take advantage of all of the tax and appreciation benefits that you would with your primary residence.

Eligibility Requirements:

  • You’ll still need a down payment for investment properties – likely around 20%
  • Your income and credit score will be heavily scrutinized.
  • Your debt-to-income ratio will likely need to be 45% with good credit.
  • If you’ll be renting out your property, you may have to show 2 years of landlord experience
  • Some mortgage lenders require you to have proof of four to six months of reserves (principal, interest, taxes, insurance, etc.) on hand.

Contact us today to invest in your future with an investment property loan!

Consolidation Loans

Sometimes having more than one of something can be a good thing. When it comes to loans, that is probably not the case. If you’ve got multiple loans that you’re repaying, using a consolidation loan to combine them can lead to short and long-term benefits.

Benefits a Consolidation Loan:

  • One monthly payment
  • Refinancing benefits such as lowered interest rate, longer period of time to pay off the loan, and/or lower monthly payments
  • Pay off debt sooner and improve your credit rating

Eligibility Requirements:

  • Interest rates are determined on credit scores, but will likely be lower than some or all of the loans that you’re consolidating
  • Closing costs and other fees may apply

Contact us today to start on the path toward simplifying your finances!

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FHA 203k Home Renovations

Planning to update your kitchen or remodel the basement?
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