So you’re ready to buy a home! Beyond the challenge of finding the perfect place in which to spend the next stage of your life, you also have to navigate the complicated process of financing such a big purchase. Potential homeowners, especially first-time buyers, often face other challenges: getting enough money together for a down […]
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When it comes to buying or refinancing a house in Vermont, more people choose Union Bank for mortgage loans than any other community bank. For more than a century, our local mortgage lending team has helped customers in Vermont and New Hampshire buy their first home or condo, vacation property, or new home construction. People who buy their first house with us regularly return when they need financing to purchase their next home or have a desire to refinance.
This loyalty stems from our local insight and personalized service—your Union Bank loan officer will provide consistent local contact throughout the home buying process. We deliver on our customers’ expectations by anticipating each phase of the home buying process. Because we know the process so well, our customers don’t have to worry. Our people, systems and processes have been refined to meet deadlines and get the borrower successfully to the closing table. Partner with Union Bank for a smooth mortgage process—we are here to help!
Union Bank has frequently been recognized for investing in the success of local communities in VT and NH. The US Department of Agriculture (USDA) has chosen Union Bank as its Rural Development (RD) Home Loan Lender of the Year for Vermont for the past six years. We were also named a Vermont Housing Finance Agency (VHFA) Top Performer in 2018. Formed in 1974 by the state legislature, VHFA is a non-profit that finances and promotes affordable housing for low- and moderate-income Vermonters. As a VHFA-approved lender, Union Bank will recommend VHFA loans when they are in our customers’ best interest. Overall, our mortgage lenders will help you examine all of your loan options in order to choose the best mortgage for your needs and situation. Similarly, Union Bank is an approved New Hampshire Housing Finance Agency-approved (NHHFA) lender.
Union Bank’s partnerships with FHA, VA, USDA Rural Development (RD), Vermont Housing Finance Agency (VHFA) and New Hampshire Housing Finance Agency (NHHFA) allow us to finance and promote affordable, safe and decent housing opportunities for qualifying borrowers with limited down payment resources and/or low-and-moderate-incomes.
Stay local and go far with Union Bank! We have a full menu of mortgage loans to meet your needs, and the flexibility to help you find a personalized mortgage financing solution. Learn more about the home mortgage loan options we offer and view our current mortgage rates. We strive to bring you competitive mortgage rates in VT and NH. Our friendly mortgage lenders are available to answer your questions and discuss your options at any of our 18 banking offices and dedicated loan center in Williston, VT.
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Fixed-Rate Mortgages vs. Adjustable-Rate Mortgages (ARMs)
Fixed-Rate mortgages provide a set interest rate and monthly payment that will remain constant over the life of the loan. This type of mortgage can be used to purchase or refinance your primary residence or vacation home, or for one-to-four-family investment properties.
The primary benefit of a fixed-rate loan is its predictability. If you plan to stay in your new home for a long time, you’ll appreciate the ease of fitting your mortgage payment into your monthly budget. Fixed-rate mortgages also allow you to lock in historically low interest rates before they rise again. In this economic environment, most of our customers find that the best deal for them is a fixed-rate home loan.
On the other hand, Adjustable Rate Mortgages (ARMs) come with an initial, fixed-rate period of from one to five years. At the end of that time, your interest rate will increase or decrease, depending on the specific terms of your mortgage. As with Fixed-Rate Mortgages, ARMs can be used to purchase or refinance your primary residence or vacation home, or for one-to-four-family investment properties. Typically, the ARM initial rate is lower than a fixed rate loan and is a good loan option if you don’t plan on being in the home past the initial fixed rate period. They can also be refinanced into a fixed-rate or new ARM loan.
Check current rates and apply online for a fixed-rate mortgage or ARM, or visit your nearest branch to apply.
Government-Insured vs. Conventional Loans
Conventional loans require a 20% down payment. If you don’t have the ability to put 20% down, you may still be eligible for a conventional loan with a down payment as little as 3%, but your lender will require private mortgage insurance which increases your monthly payment. Government-insured loans come with full or partial backing from a federal government agency. As a result, these loan programs enable mortgage lenders to meet the home financing needs of military personnel and the needs of low to moderate income borrowers and low down payment or no down payment borrowers. Government loans typically have lower rates and more flexible terms than conventional loans.
Union Bank is proud to offer a full selection of government home loan programs.
- VA Loans: Eligible military personnel and surviving spouses can obtain up to 100 percent financing.
- FHA Loans: Home buyers who want a lower down payment requirement can take advantage of this loan program from the Federal Housing Administration to obtain a home loan with a down payment as little as 3.5%.
- USDA Loans: Low to Moderate income home buyers in eligible rural and suburban areas can qualify for up to 100 percent financing for home purchases.
Want to learn more about these affordable housing programs with low and no down-payment options for first-time home buyers and low-to-moderate-income borrowers? Call us at 1.800.753.4343 or stop by your nearest branch in northern Vermont or northern New Hampshire to find out if you’re eligible for a first-time home buyer or affordable housing program.
Jumbo vs. Conforming Loans
Most mortgage loans are “conforming,” meaning they qualify for the best interest rates and longest terms and are eligible for sale to the government-sponsored mortgage entities, Fannie Mae and Freddie Mac. As of 2019, the borrowing ceiling for conforming loans in Vermont is $484,350. The New Hampshire limit is the same, except for Rockingham and Strafford Counties, where it is $688,500. Remember, you can still buy a house with a higher purchase price than the conforming limit. You’d just need to make a large enough down payment to keep your mortgage principal within conforming range.
For homebuyers who need to borrow more than the conforming limit, Union Bank is pleased to offer jumbo mortgages. These larger home loans are generally considered riskier by lenders, since they cannot be sold to Fannie Mae and Freddie Mac. Therefore, they typically come with a higher interest rate than a conforming loan. Jumbo loans can always be refinanced into conforming loans once enough of the principal has been paid off to drop below the mortgage loan amounts mentioned above.
Construction and Renovation Loans
As part of our commitment to investing in Vermont and New Hampshire, Union Bank offers a convenient Build Loan for new home construction, renovations and additions, or small commercial buildings. Enjoy competitive rates on an eight-month term, with the possibility of a four-month renewal. Once your construction or renovation project is complete and the home is livable, we’ll help you convert your Build Loan to a conventional mortgage. From start to finish, financing a home construction project is easy with Union Bank.
Understanding the Mortgage Process
Until you’ve bought your first home, applying for a mortgage can seem like a complex, never-ending process. If you’re confused or frustrated, we’re here to help. The Mortgage Lending Team at Union Bank wants you to understand the mortgage process when you’re ready to apply. We are available to take your calls, emails, and in-person visits anytime during the home buying process. The mortgage process can be complicated, but it doesn’t have to be. Partner with your local community bank for a friendlier and smooth mortgage process.
- Get pre-qualified. This is an important first step—before you start looking at houses, find out how much you can borrow and get an estimate of your down payment, monthly payment, and closing costs. When you’re pre-qualified, you shop smarter and sellers are more likely to consider you a serious buyer and more likely to accept your offer.
- Apply! You’ve found your perfect home and gone under contract with the seller. Now it’s time to fill out a complete mortgage application and gather the supporting documents your lender needs to make a decision.
- Advance Disclosures: Within three days of application, we will provide disclosures detailing the loan program, estimated closing costs, and any additional documentation needed.
- Underwriting: At this point, we start the underwriting process by analyzing your credit worthiness, ability to repay, and whether or not you have sufficient assets for the down payment, closing costs, and home appraisal.
- Decision Time: If approved, Union Bank will issue a commitment letter and other documents explaining the terms and conditions of your loan approval.
- Final Review: We will review legal work, homeowners insurance, and any other remaining documentation needed to clear the loan for closing.
- Closing: This is the day you’ve been waiting for. If you are purchasing a home, you’ll typically meet with the buyer and seller’s agents, a representative of the bank, and the settlement agent to sign paperwork and receive the keys to your new home. If you are refinancing a home, you’ll meet with our representative to sign paperwork and either receive cash out or lower your payment and interest rate.
Buying a home is likely the biggest purchase you’ll ever make. It can be stressful, but it’s also incredibly rewarding. The experienced mortgage lending team at Union Bank helps reduce the stress of the home buying and mortgage process. Talk to us today and experience for yourself why more Vermonters choose Union Bank for their mortgage than any other bank. Our local mortgage lenders are here to answer all of your financing questions about a home mortgage, refinance or renovation. Stay local and go far with your nationally recognized community bank.
Give us a call at 1.800.753.4343, or drop into your nearest branch for more information.