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Federal Housing Administration (FHA) Loans
The Federal Housing Administration (FHA) program offers government-backed home loans that are ideal for low and moderate income families, helping them achieve the dream of private homeownership.
FHA financing is available for purchasing a home or for refinancing your current home loan. FHA financing offers a fixed-rate option - designed for steady monthly payments - or an adjustable rate option (ARM) which helps keep the initial payment and rate at a minimum.
Ideal for borrowers who
- Are First time homebuyers
- Have a higher debt ratio
- Are Existing homeowners who want to eventually sell, using assumable financing at a lower than market rate, attracting more buyers
- Have limited funds for down payment and closing costs
- Have less than perfect credit
- Are using down payment assistance and/or grant money
Additional Features of FHA Financing
- Low down payment — for as little as 3.5%
- Payment period that extends up to 30 years
- Higher seller contributions
- Qualifying guidelines that are less conservative than conventional financing
- Interest may be tax deductible
Veteran Affairs (VA) Loans
Department of Veteran Affairs (VA) mortgages are government-secured home loans created specifically for eligible veterans, military personnel and their spouses.
The VA home loan offers many advantages to the country's 25.5 million veterans and military personnel. Two versions are available: fixed interest rate mortgage (consistent monthly payments) and adjustable rate mortgage, which works well for people who want to keep their initial mortgage payments and interest rates at a minimum.
Ideal for veterans who
- Have a higher debt ratio
- Have less than perfect credit
- Have limited funds for a down payment
Features of a VA mortgage
- Loan amounts similar to conventional financing
- Lower interest rates
- Seller contributions toward closing costs allowed
- Qualifying guidelines that may be less conservative than typical conventional programs
- Interest may be tax deductible
- Up to 100% financing available (must meet certain criteria)
USDA Rural Development (RD) Loans
The United States Department of Agriculture Rural Development (RD) program offers a 100% financed mortgage for people who meet the minimum requirements, and want to live in a rural setting or small town.
RD loans are primarily used to help low-income individuals or households purchase homes in rural areas. These loans can be used to build, repair, or renovate homes. Rural Development loans are only available for properties located in designated areas and for those within specified income limits.
Ideal for borrowers who
- Have limited funds for closing
- Want to keep mortgage payments and mortgage insurance low
- Have low to moderate income
- Want to purchase in a rural area
Features of a RD mortgage
- 100% financing possible
- Not limited to first time homebuyers
- If certain criteria are met, closing costs can be rolled into mortgage
- No maximum purchase limit
- Interest paid may be tax deductible
- Competitive 30 year fixed rates
- Less funds required for closing
- Lower mortgage insurance than other financing options
- Available for low-to-moderate income households
Minnesota Housing Finance Agency (MHFA) Loans
Minnesota Housing Finance Agency is the state's finance agency. MidCountry Mortgage is an approved lending partner of MHFA. Minnesota Housing offers FHA, VA, RD and Conventional loans for those looking for more affordable loan options.
Ideal for borrowers who
- Need financial assistance or have limited funds for closing
- Are purchasing anywhere in the state of Minnesota
Features of a MHFA mortgage
- Not limited to first time homebuyers
- Reduced mortgage insurance rates for conventional loans
- No monthly mortgage insurance for eligible conventional loan borrowers
- Offers down payment assistance loans to those within income limits
- Offers minimum down payments from zero to five percent down
- 15 and 30 year fixed rate loans
- Down payment assistance loans can be coupled with other assistance programs
- Offers options for rehab loans with or without down payment assistance
FHA 203k (Rehab Loan)
The FHA 203K program is a federally insured mortgage program for the purchase and rehabilitation/repair of one to four unit owner occupied properties.
It’s an important tool for community and neighborhood revitalization and for expanding homeownership opportunities. Purchase and re-finance transactions are both eligible for 203K financing.
Two versions are available: one for projects up to $35,000 (referred to as "Limited") and one for projects between $35,000 and your regional FHA loan limit (referred to as "Standard").
One loan covers both the purchase (or refinance) and the cost of repairs.
Ideal for borrowers who
- Want to repair their current property
- Have limited funds for down payment, closing costs and necessary repairs
- Are interested in purchasing a home in need of repair, rehab or updating
- Couldn’t afford to fix up their homes unless they had ready cash on hand
Eligible improvements
- Painting
- Room additions
- Kitchen remodeling
- Bathroom remodeling
- Finished basement
- Patio and deck replacement
- Yard grading
- Energy-efficient upgrades
- Appliances
- Electrical and plumbing upgrades
Note: Luxury improvements that do not become a permanent part of the real property (e.g., playgrounds, hot tubs, gazebos) are not eligible.
Home Ready and Home Possible Loans
Home Ready (Fanniemae) and Home Possible (Freddiemac) loans are conventional loan programs that offer low down payments and reduced mortgage insurance to home buyers or those wishing to refinance.
Ideal for borrowers who
- Want conventional financing with low down payments
Features of a Home Ready and Home Possible mortgages
- Down payments as low as 3%
- Available on one and two unit properties
- Reduced mortgage insurance rates
- Income limits in some areas, check with a mortgage expert
- Available to first time or repeat buyers
- Home buyer education required
- Interest rates better than traditional conventional loans
Down Payment Assistance Loans
Pair this mortgage with most down payment assistance programs to make owning a home within reach.
Ideal for borrowers who
- Are very low to moderate income
- Need assistance to improve mortgage payment affordability
- Will benefit from down payment assistance
Down Payment Assistance Offerings
Low to moderate income borrowers may benefit from down payment assistance loans and/or grants offered by many governmental and non-profit entities. MidCountry Mortgage fully supports and cooperates with as many assistance programs as possible. Ask us about:
- FHLB Home$tart and Home$tart Plus loans
- FHLB loans for Native Americans
- Project Reinvest
- Minnesota Housing down payment assistance
- Community and neighborhood grants or loans