Home Loan Options from The Potempa Team and OneTrust Home Loans


Get to know your home loan options from the Potempa Team and OneTrust Home Loans in this comprehensive guide! Homeownership is one of the most significant investments a person can make in their lifetime. It is a symbol of stability, security, and the American Dream that often starts with securing the right kind of financing. With so many different types of residential home loans available, it can be difficult to know where to start.

Our aim is to help you understand the various loan options so you can be confident going into your first meeting with our team. We are licensed in thirty-two states including Arizona, California, Florida, Texas, Michigan, and Washington. Whether you are a first-time homebuyer or looking to buy your next home, this guide will give you the knowledge to navigate the mortgage landscape.

Conventional Loan Options

Conventional loans are the most popular type of home loan in the United States, accounting for nearly 70% of all mortgages. Previously, conventional loans required a 20% down payment, making them a less accessible option for first-time home buyers. However, recent changes in the mortgage industry have made conventional loans more accessible, with some conventional loan programs requiring as little as 3-5% down. These loans now compete directly with traditional low down payment programs such as the FHA loan program. Conventional loans are provided by private lenders and must meet the underwriting requirements of Fannie Mae or Freddie Mac, two of the largest acquirers of mortgages on the secondary market. However, they cannot exceed the conforming loan limits set by the Federal Housing Finance Agency (FHFA). Loans that exceed these limits are referred to as Jumbo Loans and have different underwriting guidelines. When you meet with the Potempa Team to get pre-approved, be sure to review your home loan options and the current conventional loan limits in your state!

FHA Loan Options

FHA loans are a popular option for those looking to buy a home. To be eligible for an FHA loan, the home must be appraised by an FHA-approved appraiser, must be the borrower’s primary residence, and must meet minimum property standards set by the FHA. Borrowers must also typically have a minimum credit score of 580, a minimum down payment of 3.5% of the home’s value, and a debt-to-income ratio that qualifies them for the loan. Self-employed individuals can apply for an FHA loan, with the required documentation typically being their current tax returns and business books. One of the main differentiators between this loan type and a conventional loan is the requirement of mortgage insurance for an FHA loan.

VA Loan Options

The VA loan is a type of residential mortgage loan offered to eligible active service people and veterans. This loan provides these borrowers with equal opportunities to buy homes and offers benefits such as a minimum FICO score of 580, no down payment requirement (unless specified by the lender), limitations on closing costs, and the ability to finance both single-family residences and manufactured homes. VA loans also offer 100% financing and the possibility of refinancing with a VA streamline or cash-out loan. The streamline option offers a lower mortgage rate for an already existing VA loan, while the cash-out option involves a credit check and appraisal.

Jumbo Loan Options

Jumbo loans are only provided for higher-cost properties above the conforming loan limit and are riskier for lenders, therefore, the underwriting procedure for these loans is more stringent. The requirements for a jumbo loan include a credit score of 700 or higher, a lower debt-to-income ratio, a variety of financial documents, and in some cases, a second home appraisal. Be sure to speak with a member of the Potempa Team to discuss what’s needed for your jumbo loan! Although you do not always have to put down 20% to finance your new home, be prepared to put down between 10-30% and have plenty of cash reserves to assure the underwriter of your financial health.

USDA Loan Options

USDA loans, also known as Rural Development Loans, provide an alternative mortgage option for prospective home buyers to buy or build homes in sparsely populated areas. These loans offer low, fixed-interest rates, and have no down payment and closing costs built into the loan amount, making it affordable for people to own a home in these areas. Requirements to purchase a property with a USDA loan state that the subject property needs to be 2,000 square feet or less, appraise at or below fair market value for the area, and that there is no in-ground swimming pool on the property. Additionally, the property can’t be used for commercial purchases. These requirements aim to provide fair opportunities to those who truly need them. The same grants can also be offered as loans to younger families who already own a property that needs updates and maintenance.


Ready to discuss the home loan options available from the Potempa Team and OneTrust Home loans? Click here to get in touch or start the pre-approval process today!

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