Home Loans In Kennewick, Washington

Kennewick is a city in Benton County of southeastern Washington. It is the most populous of the three cities referred to as the “Tri-Cities,” consisting of Pasco, Richland, and Kennewick, respectively. The housing market in Kennewick is somewhat competitive, with an average median price of $421k, and sells around 70 days.

Home Loan Programs In Kennewick

Different loan programs are available in Benton County, Washington, and each has pros and cons. For example, FHA loans may be a good choice for borrowers with a lower credit score or a smaller down payment, while VA loans are available to veterans and active-duty military members. It’s essential to weigh the pros and cons of each loan program and choose the one that fits your financial situation and goals the best. Here are the most prevalent mortgage loans in Kennewick:

• Conventional – Conforming Loans

Conventional loans are mortgages not insured or guaranteed by the federal government. A conventional-conforming loan is a type of mortgage that satisfies Fannie Mae and Freddie Mac’s funding requirements and conforms to their loan limits.

To be eligible for a conventional-conforming loan, you must have a credit score of at least 620 and a debt-to-income (DTI) ratio of less than 45%. Conventional loans require a down payment of 20% to avoid Private Mortgage Insurance (PMI). However, conventional loans’ minimum down payment requirement varies from 3 – 5%, depending on the borrower’s circumstances.

The maximum loan limit for Kennewick, Benton County, is $726,200 for a single-unit home and up to $1,396,800 for 4-units.

• FHA Home Loans

FHA loans are mortgage loans insured by the Federal Housing Administration (FHA) under the jurisdiction of the US Department of Housing and Urban Development (HUD). These loans are intended to assist first-time homebuyers and low-income borrowers in purchasing a home by requiring a lower down payment and credit score than conventional mortgages.

One of the advantages of an FHA loan is that it requires a smaller down payment than conventional mortgages, as low as 3.5%. However, a borrower must have a credit score of 580 to qualify for the 3.5% down payment. FHA loans are more flexible and allow a higher debt-to-income (DTI) ratio than conventional loans.

Yet, there are certain disadvantages to FHA loans. FHA loans, for example, require borrowers to pay a mortgage insurance premium (MIP) both upfront and annually, which can raise the loan’s overall cost over time. Furthermore, FHA loans may have more rigorous property requirements, such as a purchase price cap and required repairs for specific concerns before the loan can be closed.

The FHA loan limits for Kennewick, Benton County, in 2023 are $472,030 for a single-family residence, $604,400 for a Duplex, $730,525 for a Tri-plex, and $907,900 for a Quad-plex, respectively.

• VA Home Loans

A VA home loan is a mortgage loan guaranteed by the Department of Veterans Affairs (VA) and accessible to qualified veterans, active-duty service members, National Guard and Reserve personnel, and surviving spouses. They are offered by private lenders such as banks, credit unions, and mortgage companies.

To qualify for a VA loan, you must be an eligible veteran or military spouse with available VA loan entitlement, use the loan for an approved purpose, occupy or expect to occupy the house within a reasonable timeframe, and be a credit risk acceptable to the lender. In addition, you must have a decent credit rating, sufficient income, and a current Certificate of Eligibility (COE).

One of the key benefits of a VA loan is that there is no requirement for a down payment, which can help minimize the initial expenses associated with buying a home. Moreover, VA loans often have lower interest rates than conventional mortgages and do not require mortgage insurance (PMI). Furthermore, VA loans offer flexible terms and options, such as fixed-rate and adjustable-rate mortgages, and allow refinancing.

• USDA Home Loans

A USDA home loan in Benton County, Washington, is a mortgage loan offered by the US Department of Agriculture (USDA). These loans are meant to help people with low income get decent, safe, and sanitary housing in rural areas that qualify. To be eligible for a USDA loan, the home must be located in an eligible rural region as defined by the USDA.

To be eligible for a USDA loan, applicants must have an income that is less than the area’s median income, be a US citizen or permanent resident, have a stable source of income, and have a credit history that demonstrates the ability to repay the loan. Furthermore, the property must meet the USDA’s fundamental qualifying conditions, which include rural area classification, occupancy, and the physical condition of the residence.

One of the primary benefits of a USDA loan is that it provides 100% financing, which means there is no down payment required. USDA loans feature lower interest rates than conventional loans and do not require private mortgage insurance (PMI). Furthermore, USDA loans provide numerous terms and options, such as fixed-rate and adjustable-rate mortgages and refinancing opportunities.

• Jumbo Loans

Jumbo loans exceed the Federal Housing Finance Agency’s conforming loan limit (FHFA). In Benton County, Washington’s conforming loan maximum is currently $726,200. As a result, any loan amount above this limit is classified as a jumbo loan.

The eligibility requirements for a jumbo loan vary by lender, but applicants generally must have a high credit score, a low debt-to-income (DTI) ratio, and adequate cash reserves. A high credit score is typically required to qualify for a jumbo loan, with 720 or more being the norm. Borrowers should also have at least 12 months of reserves equal to 12 months of mortgage payments after closing.

Apply for a Home Loan in Kennewick

Capital Home Mortgage is both a direct lender and a mortgage loan servicer. Kennewick residents are eligible for our full range of home purchases, home renovations, and refinancing loans. Our highly experienced mortgage team will work with you to discover the best lending package that matches your needs while staying within your budget.

Please call us at (253) 528-4417 to get started on your path to home ownership.