Lumi Funding Group

What is a Conventional Home Loan and how does it work?

A Conventional Home Loan is a mortgage not insured by the government and typically offered by private lenders. These loans follow Fannie Mae and Freddie Mac guidelines, often require a higher credit score, and come with flexible term options. Borrowers can use a conventional loan to purchase a primary home, second home, or investment property. Conventional mortgages may offer competitive rates, especially for borrowers with strong credit and a stable income.

What is an FHA Loan and who qualifies for it?

An FHA Loan , insured by the Federal Housing Administration, is designed to make homeownership more accessible, especially for first-time buyers or those with lower credit scores . FHA loans typically require a minimum down payment of 3.5% and allow for more flexible credit qualifications. They’re ideal for buyers looking for low down payment options and more lenient approval criteria .

What are VA Loans and what benefits do they offer to veterans?

VA Loans are backed by the U.S. Department of Veterans Affairs and are available to eligible veterans, active-duty service members, and surviving spouses. These loans offer no down payment, no private mortgage insurance (PMI) , and competitive interest rates. VA Home Loans are a powerful benefit designed to make homeownership more affordable for those who have served in the military.

What is a USDA Loan and how can rural buyers qualify?

A USDA Loan , offered by the U.S. Department of Agriculture, helps low-to-moderate income buyers purchase homes in eligible rural and suburban areas . These loans offer 100% financing, reduced mortgage insurance, and affordable interest rates . To qualify, the property must be located in a USDA-approved area, and the borrower must meet income and credit requirements.

What is a Jumbo Loan and when do you need one?

A Jumbo Loan is a mortgage that exceeds the conforming loan limits set by the Federal Housing Finance Agency (FHFA). These loans are used to finance high-value properties , especially in competitive real estate markets like California and New York. Jumbo loans typically require a higher credit score, larger down payment, and strong financial reserves due to the increased lending risk.

What is a Reverse Mortgage and who is it for?

A Reverse Mortgage is a loan option available to homeowners aged 62 or older that allows them to convert part of their home equity into cash without selling their home. The most common type is the Home Equity Conversion Mortgage (HECM) . Repayment is deferred until the homeowner moves out, sells the home, or passes away. It’s a helpful tool for retirees looking to supplement retirement income.

What are Non-QM Loans and who should consider them?

Non-Qualified Mortgage (Non-QM) Loans are designed for borrowers who don’t meet the strict guidelines of traditional loans, such as self-employed individuals, business owners, or those with non-traditional income. These loans may use bank statements, 1099s, or asset documentation instead of tax returns. Non-QM loans provide flexible financing options for unique income situations.

What is a Bank Statement Loan and how does it help self-employed buyers?

A Bank Statement Loan allows self-employed borrowers to qualify for a mortgage using personal or business bank statements instead of tax returns. This type of loan evaluates average monthly deposits to determine income , making it ideal for entrepreneurs, freelancers, and business owners with strong cash flow but irregular income documentation.