The right type of mortgage for your situation will depend on what kind of home or property you’re looking to buy, as well as what you can qualify for. Because of all the beautiful land in Frederick County, we at Woodsboro Bank understand that you might need mortgages for things like farmettes that don’t fall neatly into standard categories. Before you make a decision on the type of mortgage you’d like to pursue, be sure you are up to date on the many varieties you have to choose from.
Fixed Rate Mortgages
The most common type of mortgage is a fixed-rate mortgage. You can take out a fixed-rate mortgage on the building that is going to serve as your primary residence, and as the name implies, the rate of interest on the mortgage is fixed for the entire life of the loan. In other words:
- The rate will never go up or down
- You’ll always know what your monthly payment is going to be
- You can predict the exact date of payoff if you stay consistent
If you plan on owning your home for a long time (at least five to seven years), a fixed-rate mortgage may be a good choice.
Adjustable Rate Mortgages
Unlike their fixed rate counterparts, adjustable rate mortgages do not keep the same interest rate for their entire duration. You may see adjustable rate mortgages described as some variation of, for example, 10y/6m ARM. This means that for the first ten years (10y), the interest rate will stay the same. After that, the rate will be readjusted every six months (6m). These mortgages are a worthwhile choice when:
- You don’t plan on staying in the home longer than the initial rate period
- You think interest rates will continue to go down in the future
An FHA Loan
If you do not meet the standard criteria for a typical mortgage, such as an inability to provide a high enough down payment, you may qualify for an FHA loan. Many first-time home buyers opt for this choice since they do not have profits from a previous house sale to help fund a new down payment.
Specialized Mortgage Options
Of course, a standard residential home may not be the right fit for you. That’s why there are other, more specialized types of mortgages that may suit your needs, such as:
If you want to purchase a property that is particularly expensive, you may not qualify for a standard mortgage. Many mortgages have caps for maximum funding. A jumbo loan exceeds this cap and opens up the possibility of more expensive properties.
If you are a veteran, you can enjoy benefits such as a low or zero down payment when purchasing a home. This ensures that our country’s valuable military and public service members have access to the housing market.
A person’s debt to income ratio can disqualify them for many types of loans—and few professions carry as much starting debt as physicians. These unique mortgages exist with that in mind, to allow those in the medical field to purchase homes with a lower down payment.
Alternate Options For Mortgage Funding
In Frederick County, you have a lot of options to buy land or expand your property. For these types of purchases, standard mortgages do not fully fit the bill. Woodsboro Bank offers a wide variety of mortgage options that suit the needs of our local clients, including:
- Construction Loans: For when you need to fund a home that isn’t built yet, or if you want to make big changes
- Lot Loans: For when you want to purchase land, whether that land will be developed or left unimproved
- Investment Mortgages: If you want to invest in a property that you can rent, you’ll need a special mortgage
Rely On Your Community Bank To Provide Customized Borrowing Solutions
Your needs are just as unique as you are—and that is why Woodsboro Bank specializes in offering customized solutions that will help you to achieve your goals. Reach out online or over the phone at 301-898-4000 with any questions or to schedule an appointment with one of our experts to get started.