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Iowa Home Mortgage - A Borrower's Options for Home Mortgages in Iowa - No Documentation Loan, Fixed Rate mortgage Loan, Adjustable Rate mortgage (ARM)

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Home mortgage loans are commonly used to pay the seller of a piece of property in full. There are several loan products on offer in Iowa, such as no documentation loan, fixed rate mortgage loan, adjustable rate mortgage, jumbo loan and reverse mortgage.

No Documentation Loan

With a no documentation loan the buyers does not have to state their income or prove that they are employed. This loan offers different programs, and it may be offered because borrowers don’t want to disclose any personal information. A no documentation loan is generally more expensive than a standard Iowa home mortgage option, but does not have the same features.

Fixed Rate mortgage Loan

This type of Iowa home mortgage loan offers fixed or permanent insurance rates for the duration of the loan. The cost and interest rate that the borrower pays can vary. Since the interest rate does not change, fixed rate mortgage loans are not affected by condition of the market. In comparison to adjustable rate mortgage loans, the interest rate on fixed rate loans is generally two to three percent higher.

Adjustable Rate mortgage (ARM)

As mentioned above, the payment on ARM is slightly lower than fixed rate, but due to its adjustable nature, the payment will adjust itself with fluctuation in the market. Therefore, if the interest rates go down, so does the monthly payment that the borrower has to make.

Jumbo Loan

Jumbo loan is also called a non-conforming loan. it exceeds the standard conforming Iowa home mortgage loan amount of $322,700. Borrowers usually have to pay higher interest rates with Jumbo loans, because of the size of the amount being lent. Usually, jumbo loans are used in offices or industrial complexes or in areas with a high cost of living.

Reverse Mortgage

This type of Iowa home mortgage provides borrowers the opportunity to earn an income from their debt. With a normal mortgage loan, the lender allows borrowers to use debt to turn their income into home equity by paying on a monthly basis. In reverse mortgage loans, the borrowers reversing how they bought their home. Borrowers previously wanted equity and had income, now they want income and have equity. In both mortgages debt is used to turn, what the borrower needs into what they essentially have.

Iowa has a minimum of $30,000 on purchase transactions on sub-prime loans. Also, buyers who continue to be current on their payments do not have to surrender their home.

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