Financing Type

Financing Type is the form of financing used to purchase a home. When evaluating an offer, cash offers are generally preferred to mortgages or other types of loans. This is because of the lower appraisal risk and faster closing time that cash offers imply. Among various forms of mortgages or loans, the order of preference is (1) conventional loan; (2) FHA loan or VA loan; and (3) private loans (aka hard money). The appraisal and inspection standards for FHA and VA loans are generally higher than conventional loans since these are government-subsidized loans. The down payment requirements for these two types of loans are also considerably lower.