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Types of Home Loans for Purchase

Types of Home Purchase Loans

Buying your first home? Whether it's your first home, a vacation home, or an investment property, PennyMac has many types of home loans with a variety of product and terms to choose from. Review the loan products below, then talk to a PennyMac Loan Specialist at (866) 549-3583 to review the best rates and options for your situation.

Fixed Loans

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Fixed Rate Loans

With fixed-rate loans, you can rest assured that your monthly payments remain the same for the life of your loan.

  • Available in 30, 25, 20, 15, and 10-year options
  • Your interest rate will not change for the life of your loan
  • Build equity faster with a shorter term 15-year loan instead of the traditional 30-year loan.
  • Easier for setting your household budget
  • Available for home purchase and refinance transactions

FHA Loans

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FHA Loans

The Federal Housing Administration (FHA) insures loans offered by PennyMac under this program. Get a flexible loan that is easy to qualify for.

  • Down payment options as low as 3.5%
  • No maximum income/earning limitations
  • Insured by the Federal Housing Administration (FHA)
  • Insurance from the federal government replaces private mortgage insurance (PMI)
  • Maximum loan amounts vary by county
  • Flexible income, debt, and credit requirements

VA Loans

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VA Loans
  • Available for qualified veterans
  • Flexible credit requirements
  • Limited closing costs and other benefits

Jumbo Loans

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Jumbo Loans

With PennyMac, you get low jumbo loan rates with personalized service.

  • Loan amounts up to $2 million
  • Fixed and adjustable-rate options
  • First and second homes permitted

Adjustable Loans

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Adjustable Loans

PennyMac offers hybrid ARMS - adjustable rate loans that carry a fixed interest rate for 3, 5, 7, or 10 years, then the interest rate changes each year based on a market index. ARMs typically start with lower monthly payments than fixed-rate loans, but once the fixed period ends, the payment will change - either up or down - as the interest rate changes with market conditions.

A hybrid ARM loan is not an interest only loan and does not have a negative amortization option. PennyMac adjustable rate mortgages are fully amortizing loans in which the borrower pays both the principal and interest throughout the life of the loan. The term of the loan is typically 30 years.


After the fixed interest rate period has passed, the length of which varies by hybrid ARM product, the interest rate and payment will adjust annually. So, a 3/1 ARM is fixed for three years and adjusts once per year at the expiration of the fixed period. The loan has caps, or specific limits, that the interest rate cannot exceed when it adjusts. These caps are based on the start rate of the loan, which is the rate the loan had when originated, and the current rate.


Because your payment and interest rate can increase, you should be prepared financially for any possible increase in rates and payment, if you're considering an ARM.


An ARM could makes sense for you if you:

  • Plan to sell your home or refinance before the end of the initial rate period and therefore aren't concerned about possible rate increases
  • Anticipate your income rising enough in the coming years to cover higher mortgage payments if interest rates go up.
  • Want the initial lower payment that the ARM offers to qualify for a larger loan, but can afford to pay the fully indexed rate
  • Believe that mortgage interest rates may decline in the future and can accept the risk if they don't.

When shopping for a mortgage, a hybrid ARM can be a good choice for some borrowers. There are many types of home loans, so talk to your PennyMac loan officer to see if an adjustable rate loan makes sense for you.

Now get real-time PennyMac rate quotes on your phone.