Distinctive Services & Programs
With a wide variety of standard and unique offerings, we have a loan to meet your needs.
We’re a correspondent lender with a full range of standard and unique loan products: Conventional, FHA, FHA 203k, VA, USDA, CHFA, and many other bond programs in the states where we do business. Steve Cowan has the products and experience to get your next loan approved.
Conventional Loan Program
If you don’t qualify for a specialized loan, such as an FHA, VA, or USDA-backed loan, then you can still work out favorable terms for yourself under our conventional loan program.
What is a conventional loan?
A conventional loan is not backed by any federal agency, as opposed to a loan like an FHA loan, which is backed by the Federal Housing Administration for low-income families and individuals.
Here are a few examples of conventional loans.
Who qualifies for conventional loans?
Rather than being based on class, geographic location, or previous military service, conventional loans are based on income, credit, and down payments. Any person who has an appropriate credit score and at least a 5% down payment can qualify for a conventional loan.
Benefits over an FHA loan
While the benefits of having a federally-backed loan don’t apply to traditional conventional loan programs, there are some ways that conventional loans can actually lead to great savings, at least when it comes to FHA loans. Unless you put down 20% or more on a down payment for a mortgage, you will need to pay private mortgage insurance (PMI). However, even if you only put down a minimal 5% down payment, you can petition to eliminate private mortgage insurance payments after 2 years of on-time payments, when on a conventional loan, but not on an FHA loan. This can lead to hundreds of dollars in savings, every year, on payments that aren’t going towards the equity on your home. In this way, conventional loan programs can make up for the lower interest rates of federally-backed loans.
If you have ever served in the United States military, you might qualify or a VA loan. The VA loan program has helped our armed service personnel purchase homes at beneficial terms for over 70 years.
What is a VA loan?
The VA loan program is an aspect of the Servicemen’s Readjustment Act of 1944, or the GI Bill, as it is commonly known. This bill was meant to assist veterans who had served in defense of the nation. Part of this bill included assistance in purchasing a home.
Today, VA loans are offered by a variety of financial institutions, including:
Other loan companies
Who qualifies for a VA loan?
Today, there are over 25.5 million individuals who qualify for some sort of a VA Loan. In order to receive a VA Loan, you must qualify for at least one of the following categories:
You have served, full-time, for at least 2 years in the armed forces.
You have served in the National Guard, or reserves, for a period of 6 years (this timeline is reduced if you are called to active duty).
Why get a VA loan?
There are many benefits of going with a VA loan, rather than a conventional loan. Here are some of the major reasons that qualifying individuals should opt for a VA loan:
No down payment is required
Borrowers do not need private mortgage insurance
Interest rates are generally lower than conventional loans
Less stringent credit stipulations
Low ceilings on closing costs
Continuous foreclosure avoidance support (once you have your home)
VA loan restrictions
A VA loan at least guarantees those that qualify a portion of a home loan, with a maximum of 25%, up to $121,087. This means that the loan only qualifies for a maximum amount of $484,350.
There are also fees for using a VA loan. For example, a first-time user of a VA loan, without a down payment, is levied a 2.15% fee. This amount is lowered to 1.25% if they pay a 10% down payment, but will rise to 3.3% for the second time that you utilize a VA loan.
Many Americans dream of building their own home, but construction costs are not cheap. A construction loan is a type of loan that people can use to borrow money from banks and lenders to cover the costs of building a home.
Who qualifies for a construction loan?
Construction loans are risky for lenders because there isn’t any inherent collateral until the home is constructed and is up-to-code. As such, requirements for construction loans are more stringent.
Here is a list of the requirements that lenders typically require to approve a construction loan:
A licensed contractor with a strong resume must be signed onto the project
A comprehensive construction plan needs to be developed and shown to the lender
The projected home value must be approved by a licensed appraiser
At least a 20% down payment is required (and sometimes higher)
Obviously, a high credit score is necessary
A construction loan is divided into draws for each section of the construction process where the contractor will be granted different portions of the loan. For example, building the framework and building the roof could be done with different draws. This is done to mitigate some of the lender’s risk.
Rural Housing Loan
Rural housing loans (USDA loans) are backed by the United States Department of Agriculture. They enable homebuyers to purchase homes in less populated areas around the United States, in order to promote rural development. One-in-three Americans live in an area that qualifies for a USDA loan.
Benefits of USDA loans
Because the loan is backed by the United States Department of Agriculture, there are immense advantages of USDA loans that most people can’t get with any other type of loan. Here are some of the benefits of USDA loans:
No down payment is required. This is usually the only way for most homebuyers to qualify for a home without a down payment unless you served in the military or have another unique loan option.
Allows borrowers to get an interest rate that is lower than the current market interest rate, sometimes regardless of their credit score.
There are relaxed credit requirements, and homes can be purchased with even minimal credit history.
The private mortgage insurance (PMI) rate is lower than all other loan programs, and usually stays around .5%. (All loans without at least a 20% down payment require PMI, regardless of what loan program it is.)
Who qualifies for a USDA loan?
There are unique requirements for USDA loans. While the credit requirements for a USDA loan are incredibly relaxed, compared to other loan programs, there are specific areas across the country that are USDA-eligible. If your home or the home you hope to buy lies outside of a USDA approved area, then you are not eligible for a USDA loan. Pretty much any rural area in the country is going to be USDA-eligible. However, there are surprisingly some cities that are also USDA-eligible, due to the fact that they are classified as “rural in character.”
While the credit requirements for USDA loans are very relaxed, there are other specific requirements for USDA loans:
The home being purchased must be within a specific area that is zoned as USDA-eligible. (These areas make up pretty much any rural area in the country.)
The borrower’s income must not exceed 115% of the area’s median income.
The borrower must not exceed a 29-to-41 debt-to-income ratio.
Call our experts today, to see if you qualify for a rural housing loan!
State Bond Loan
State bond loans are paid out by using mortgage revenue bonds (MRBs). MRBs are used by local housing programs to spur first-time homebuyers to purchase in their area by locking people in at below-market interest rates.
Who qualifies for a state bond loan?
There are several major criteria that must be met before a homebuyer qualifies for a state bond loan. These requirements all vary, depending on the specific state or program where the loan is issued. Here are some of the requirements for individuals looking to get a state bond loan:
Must not have owned a home for a specific amount of time (usually three years)
Income requirements must be met by the homebuyer
The home must be within a certain value range
The home that is being purchased must be your primary residence (this is a consistent requirement, everywhere).