Conventional loan – Conventional loans require as little as 3% of the purchase price as a down payment. However many people will put 20% or more as the down payment, to avoid paying mortgage insurance, so the monthly payments are less.
VA loan – The VA is a loan that is backed by the Veteran’s Administration for those that have served our country. These loans, when used for the first time, do not have a down payment requirement.
FHA loan – This is a very common loan option because of the favorable loan terms. FHA loans have a very low down payment requirement (3.5% of the purchase price) which allows people to get into a home for very little money out-of-pocket. Although there is a mortgage insurance premium that must be paid because of the low down payment, the monthly payments will still be very affordable based on current interest rates.
FHA 203k loan – FHA 203k loans are designated for houses that are damaged or sorely in need of rehabilitation. The loan covers not only the cost of the property but also the cost of necessary home repairs. The down payment requirement is low. This loan covers a vast range of repairs. Bathroom and kitchen remodeling, roofing, flooring, and air conditioning systems can be funded with these loans. Words can’t describe what this loan is capable of doing for a home owner.
Utah Housing loan – The Utah Housing loan is a loan program that piggybacks off of the FHA loan program. The main difference with this loan product, is that the Utah Housing loan allows people to borrow the 3.5% down payment on a second mortgage. This second mortgage can also cover closing costs.
Under this kind of a loan, first time home buyers can purchase a home without any down payment. It is a very unique loan option for home buyers in Utah.
Each of these Salt Lake City mortgage options has their pros and cons. The best way to evaluate them is for your lender to identify your needs and see how these programs make the most sense.