Home mortgages are a crucial aspect of the housing market and provide a way for individuals to finance their home purchases. Here are the types of home mortgages you’ll hear about most often:

Conventional mortgages: These are the most common type of home mortgages and are not insured or backed by the government. They usually require a good credit score and a more sizable down payment, but 20% isn’t required. Many of our buyers put 5% or 10% down and are able to qualify for a conventional mortgage, provided they pay private mortgage insurance, or PMI. PMI is a type of insurance that protects the lender in case you are unable to make your mortgage payments. It’s required if you make a down payment of less than 20% of the home's purchase price and is added to your monthly mortgage payment until you hold a certain percentage of equity in the home.
FHA (Federal Housing Administration) mortgages: FHA mortgages are backed by the government and have more lenient credit requirements. They also require a smaller down payment, making them a popular option for first-time homebuyers.
VA (Department of Veterans Affairs) mortgages: These mortgages are backed by the VA and are available to eligible veterans and military personnel. They usually require no down payment and have more favorable interest rates.
USDA (United States Department of Agriculture) mortgages: USDA mortgages are backed by the USDA and are available for rural home purchases. They have low income requirements and offer favorable interest rates.
Adjustable-rate mortgages (ARMs): ARMs have an interest rate that changes over time based on market conditions. They usually start with a lower interest rate but can increase over time.
Fixed-rate mortgages: These mortgages have a fixed interest rate for the entire loan term. They provide stability and predictable monthly payments, but usually have a higher interest rate compared to ARMs.
Down payment assistance: Down payment assistance (DPA) is a type of financial support provided to help homebuyers pay for the down payment and closing costs of a home purchase. The idea behind DPA programs is to make homeownership more accessible and affordable to people who may otherwise struggle to come up with the large sum of money required for a down payment. The Colorado Housing and Finance Authority (CHFA) is a state-chartered organization that provides affordable housing solutions to low- and moderate-income individuals and families in Colorado. One of CHFA's programs is the Down Payment Assistance program, which provides eligible homebuyers with a grant of up to 3% of the loan amount to be used for down payment and closing costs. Slightly higher interest rates apply. The program is available to first-time homebuyers, as well as those who have not owned a home in the past three years.

When choosing a mortgage, it's important to consider factors such as your credit score, income, down payment, and long-term financial goals. It's also wise to compare the different options and consider working with a professional to find the best mortgage for your needs. There’s always a creative solution or a way to make it work — get in touch so we can talk about your options!