We offer many different types of loans. The same loan program is not right for everyone. Call us at (717) 735-2203 for immediate personal assistance.
Please refer to our Mortgage Glossary for mortgage terminology and definitions.
Conventional Loan
A loan not backed by a government agency. Typical conventional loans are backed by Fannie Mae and Freddie Mac, and are designed to provide liquidity in the residential real estate for loans that are less than $548,250 (the limit in 2021).
Benefits
- Fixed rates offered for the term
- Easy to close (30 – 40 days)
- Potential for appraisal waivers
- Up to 97% financing (3% down) (PMI required over 80%)
- Down payment can be a gift
- Fixed rate mortgage for investment properties
Disadvantages
- Maximum loan amount of $548,000
- Must be livable (not used for rehabilitation projects)
- Deed must be held in personal names (No LLC’s or entities)
- Multi-units require more money down
FHA Loan
Federal Housing Administration (FHA) is a mortgage insured by the Housing Administration and is designed for low to moderate income borrowers.
Benefits
- Up to 96.5% financing (3.5% down)
- Down payment can be a gift
- Allows credit rating to 580 (our minimum is 640)
- 96.5% financing on 1 – 4 units (must live in 1 unit)
- Allows 6% seller help
- Allows higher DTI
- Lower MI for lower credit borrowers ( .85 vs. 1.25+)
- Flexibility on newly self-employed of 1-2 years
- Shorter bankruptcy and foreclosure waiting periods
- Softer rules on collections/judgments
Disadvantages
- Sellers perception
- Amount of paperwork required
- FHA has extensive rules & regulations
- No chipped paint allowed
- Primary residences only
- Can only have 1 FHA loan (exceptions apply)
- Funding fee financed over 30 years (1.75% of loan amount)
- Monthly MI for the life of the loan
- Max loan by county ($356,000 in Lancaster, PA) https://entp.hud.gov/idapp/html/hicostlook.cfm
- Higher MI for good credit borrowers (< .45 vs .85)
- Appraisal required
- Repairs must be completed prior to settlement
USDA Loan
The United States Department of Agriculture and the Rural Development Department offer a mortgage to help develop rural areas with homeownership.
Benefits
- 100% financing
- Low monthly MI (.35) and declines annually
- Low funding fee (1%)
- Seller can pay all closing costs (6% +)
- Gift funds allowed
- Assumable (valuable when rates rise)
Disadvantages
- Income limits https://www.rd.usda.gov/files/RD-GRHLimitMap.pdf
- Property must be rural https://www.rd.usda.gov/files/RD-GRHLimitMap.pdf
- Monthly MI for the life of the loan (decreases annually based on balance)
- Amount of paperwork required
- Seller perception
- Requires two approvals (bank and USDA)
- Tight DTI requirements
- Must meet suitable housing requirement (can own only one house)
- Appraisal required
- Repairs must be completed prior to settlement
VA Loan
A mortgage loan guaranteed by the United States Department of Veterans Affairs designed to assist veterans with homeownership.
Benefits
- 100% financing
- No monthly MI
- Allows high DTI
- Lower credit allowed (600+)
- Seller can cover closing costs
- No maximum loan limits
- Waived funding fee for Veterans with disability pay
- Assumable (veterans only) (valuable when rates rise)
Disadvantages
- High funding fee https://www.va.gov/housing-assistance/home-loans/funding-fee-and-closing-costs/#va-funding-fee-rate-charts
- Must be veteran, active service or National Guard
- Appraisal by VA approved appraisers only
- Appraisal required
- Repairs must be completed prior to settlement
Jumbo Loan
A mortgage held on the books of the bank/institution and exceeds the conforming limit of Fannie Mae and Freddie Mac.
Benefits
- 30-year fixed
- No MI up to 85% financing
- Allows 90% financing (10% down)
- Loan amounts to $1,000,000
- Second homes allowed
Disadvantages
- Rate .125% – .25% above conventional
- Does not allow for investment properties
Portfolio Loan
A mortgage held on the books of the bank/institution that doesn’t fit into the conforming box.
Benefits
- 30-year fixed
- Allows for flexibility on income calculations
- Allows for flexibility on property type
Disadvantages
- .375% higher than conventional loans
- Limited by Dodd Frank and Ability to Repay regulations
Physician Loan
A mortgage designed specifically for medical professionals.
Benefits
- 100% financing
- No MI
- Flexibility on student loans
Disadvantages
- Restricted to physicians/residents with MD, DO, OD, DDS, DMD or DPM
Construction Perm Loan
A mortgage that combines land with a construction project into one loan.
Benefits
- 30-year fixed
- One close
- 95% financing
- Interest-only on draws as built
- Potential savings on transfer tax
Disadvantages
- Requires plans, specs and a builder
- .125% – .25% higher than a conventional loan
- Can take 60 days to close
Condo Loan
A conventional or portfolio mortgage specifically used for condominiums.
Benefits
- Warrantable or non-warrantable
- 30-year fixed
- 95% LTV (warrantable)
- 80% LTV (non-warrantable)
Disadvantages
- Price hit at high LTV’s
- Rate increase for non-warrantable
Private Money Loan
AKA “Hard Money” – a mortgage used for investment purposes and is typically backed by an individual.
Benefits
- No appraisal
- Up to 100% financing
- Financed rehab
- No underwriting
- Quick closings
- See also Private Money
Disadvantages
- Higher rates/points
No PMI Loan
High loan-to-value mortgages paired with single pay or lender paid MI to avoid monthly mortgage insurance premiums.
Benefits
- Up to 95% financing
Disadvantages
- .25% higher interest rate or 1 – 2.5% increased points
Second Home
A mortgage backed by a second home typically in a vacation area.
Benefits
- Up to 90% LTV
- 30-year fixed
Disadvantages
- Must be 50 miles from primary home
Investment Loan
Benefits
- 30-year fixed
- Purchase to 85%
Disadvantages
- Fees over 75% add up
- Hits for multi-unit
- No LLC’s allowed