A comprehensive list of loan options to buy a house

When it comes to buying a house, there are several types of loans available to homebuyers, each with its own set of features, benefits, and eligibility requirements. Here are some of the most common types of loans used to finance the purchase of a home:

1. Conventional Loans: Conventional loans are mortgage loans that are not insured or guaranteed by the government. They typically require a down payment of at least 3% to 20% of the home's purchase price and have fixed or adjustable interest rates. Conventional loans are available in various term lengths, including 15-year and 30-year fixed-rate options.
   

2. FHA Loans: FHA loans are mortgage loans insured by the Federal Housing Administration (FHA). These loans are popular among first-time homebuyers and borrowers with less-than-perfect credit, as they often require lower down payments (as low as 3.5% of the purchase price) and have more flexible credit requirements. FHA loans have both upfront and annual mortgage insurance premiums.
   

3. VA Loans: VA loans are mortgage loans guaranteed by the U.S. Department of Veterans Affairs (VA) and are available to eligible veterans, active-duty service members, and certain surviving spouses. VA loans offer several benefits, including no down payment requirement, competitive interest rates, and limited closing costs. Borrowers typically need to obtain a Certificate of Eligibility (COE) to qualify for a VA loan.
   

4. USDA Loans: USDA loans, also known as Rural Development loans, are mortgage loans guaranteed by the U.S. Department of Agriculture (USDA). These loans are designed to help low- to moderate-income borrowers purchase homes in eligible rural and suburban areas. USDA loans offer 100% financing (no down payment required) and competitive interest rates.
   

5. Jumbo Loans: Jumbo loans are mortgage loans that exceed the conforming loan limits set by Fannie Mae and Freddie Mac. Because they exceed these limits, jumbo loans typically have higher interest rates and stricter credit and income requirements. They are often used to finance high-value properties or homes in expensive housing markets.
   

6. Fixed-Rate Loans: Fixed-rate loans have a fixed interest rate for the entire term of the loan, meaning your monthly principal and interest payments remain the same throughout the life of the loan. Fixed-rate loans offer stability and predictability, making them a popular choice for borrowers who prefer consistent monthly payments.
   

7. Adjustable-Rate Loans (ARMs): Adjustable-rate loans, or ARMs, have an interest rate that adjusts periodically based on market conditions. The initial interest rate is typically lower than that of a fixed-rate loan, making ARMs an attractive option for borrowers who plan to sell or refinance their home within a few years. However, ARMs carry the risk of future interest rate increases and higher monthly payments.
   

8. Interest-Only Loans: Interest-only loans allow borrowers to pay only the interest on the loan for a specified period (typically 5 to 10 years) before the loan converts to a traditional principal and interest payment. Interest-only loans can offer lower initial payments but may result in higher payments once the interest-only period ends.
   

9. Balloon Loans: Balloon loans are mortgage loans that require borrowers to make relatively low monthly payments for a fixed period (usually 5 to 7 years) before a final "balloon" payment becomes due. Balloon loans can be risky for borrowers who may not be able to afford the balloon payment when it comes due, so they are less common than other loan types.
   

10. Bridge Loans: Bridge loans are short-term loans that help borrowers "bridge" the gap between the purchase of a new home and the sale of their existing home. These loans typically have higher interest rates and fees than traditional mortgage loans and are designed for borrowers with strong credit and significant home equity.
    

Before choosing a loan type, it's essential to consider your financial situation, long-term goals, and eligibility criteria. Working with a knowledgeable mortgage lender or loan officer can help you explore your options and find the loan that best fits your needs and circumstances.