A loan is a great help to every individual as they can meet their financial targets. However, getting approval for a loan is not as easy as it seems. Borrowers need to offer their personal information and credit information to help lenders define their reliability & authenticity. Now you might be wondering what specialty mortgage loans are? Well, in simple words, every loan is a specialty loan. Below, you will find a few of the mortgage categories that fall under specialty loans.
Good Neighbor Next Door
This loan option is not more popular amongst emergency medical technicians, firefighters and law enforcement officers, and teachers. However, the loan is favorable and affordable as it offers a discount of up to 50 percent. However, the loan term includes one major condition: that is the borrower needs to live in the home for three years.
VA Home Loans
VA loans are for the borrowers who have served the country. In other words, who are militants and also applicable to specific civilian employees of the government. It’s one of the best home loans; however, one needs to go through the first-time home buyers’ guide to learn in-depth about VA and other types of home mortgages.
Have you ever heard of Fannie Mae and Freddie Mac programs? Well, these two are perfect for low and moderate-income families. Again the first-time homebuyers can learn about these two widely used programs to purchase the home.
Energy-Efficient Mortgage (EEM)
The specialty mortgage also includes an energy-efficient mortgage that allows borrowers to add green features to their homes. The best part of the loan is that it is available at lower interest rates. The loan becomes cost-effective once the desirable improvements are made at home. The changes increase the value of the house.
FHA Rehabilitation Program
The FHA 203(k) stands for Federal Housing Administration. The program is affordable to borrowers as it carries lower interest rates or fewer down payments. However, one can raise funds from the program once some improvements are completed.
Native American Direct Loan
It is a zero-down 30-year fixed-rate mortgage which makes it easy for borrowers to pay off their interest as they are pretty low. The loan application to the Native American veterans.
State And Municipal Programs
In the United States, generally, every state & city offers special grants and programs to the borrowers. One must have an eye on such a loan program as they can be very helpful down the road.
Interest Only Or Extended Term
Interest Only loans have a term of up to 40 years which some borrowers require. For them, it’s hard to pay off the higher interest rate, so they prefer to extend the term to pay lower monthly payments. Moreover, they can pay off the loan without becoming bad debts. In addition, these types of loans are made to serve the special needs of the borrowers.
In conclusion, there is no official specialty loan category. The loan covers all types of consumer & commercial loans to meet the particular needs of the borrowers. Now, if someone asks you about the specialty loan, then you can explain them clearly.