5 Types of Mortgages You May Not Know Exist

Most people have heard of conventional and FHA loans, but they're only a small part of what's available. Here are five mortgage options that could be worth knowing about, depending on your situation.

1. Renovation Loans

A renovation loan allows you to finance both the purchase of a home and eligible improvements with a single mortgage. It's a great option if you find a home with potential but know it needs some work before it truly feels like home.

2. USDA Loans

USDA loans are designed for eligible rural and many suburban properties and can offer qualified buyers the opportunity to purchase with no down payment. Many people are surprised to learn just how many areas qualify.

3. Bank Statement Loans

Bank statement loans are designed for self-employed borrowers whose tax returns don't fully reflect their income. Instead of relying solely on tax documents, lenders may use bank statements to help determine qualifying income.

4. Asset Utilization Loans

Some borrowers have substantial savings or investments but little traditional income. Asset utilization loans allow eligible assets to demonstrate the ability to repay the loan.

5. Bridge Loans

A bridge loan can provide temporary financing that helps you purchase your next home before selling your current one. That can make moving much easier when timing doesn't line up perfectly.

There's no one-size-fits-all mortgage. Working with a mortgage professional can help you explore loan options that fit your unique financial situation.