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Adjustable-Rate Mortgage (ARM)

This type of loan offers interest rates that fluctuate, or vary, with current market conditions throughout the loan’s lifetime.

  • Variable interest rate
  • Rate may be lower initially than fixed-rate mortgages
  • Choose an initial adjustment period of 5, 7 or 10 years
  • Down payment could be as low as 10%

An adjustable-rate mortgage can be your best avenue for optimal savings. It depends on the current interest rate, your home’s total cost and how you feel about a rate that will change. 

If you don’t plan to stay in your home for a long time, you’ll want to consider an adjustable rate loan when rates will be lower in the beginning.

Construction to Permanent Loans

Save on mortgage costs by only paying the interest until your construction period is complete.

  • Borrow up to 95% of either the appraised value of the property with Private Mortgage Insurance (PMI) or the cost of the construction, whichever is lower
  • Available as a fixed or adjustable rate loan
  • No prepayment penalty
  • Up to five draws are available to help you finance your construction costs throughout the process

If you’re looking to build your new home, our Construction to Permanent Loans help you save on mortgage costs. While your home is in construction, you pay only the interest on your mortgage until your construction period is complete.

Then your mortgage converts to a fixed or adjustable rate loan. It’s never been easier to finance a home from building it to living in it.

Fannie Mae HomeReady® Loan

Enables affordable housing opportunities for borrowers with low-to-moderate income.

  • Available for home purchases and limited cash-out refinances
  • Put as little as 3% down
  • Affordable and cancellable mortgage insurance available
  • Wide range of down payment and closing cost funding sources accepted
  • Income limit is 80% of Area Median Income*
  • Homeownership education and counseling options are available

*Area Median Income data source is Fannie Mae.

The Fannie Mae HomeReady® Loan program offers fixed-rate mortgage loans designed to make home ownership more accessible for more people. Created to meet the needs of borrowers with low-to-moderate income, HomeReady™ offers affordable financing with flexible terms.

Wide range of down payment and closing cost funding sources accepted including gifts, grants, cash-on-hand and Fannie Mae Community Seconds.

Fannie Mae HomeStyle® Renovation Loan

One easy loan that covers both your new home or refinance and funds for repairs.

  • Fixed-rate loans available
  • Any improvement that adds value and is permanently affixed to the property is eligible
  • Use for renovations or improvements totaling up to 75% of the as-completed appraised value
  • Primary residences, one-unit second homes, or single unit investor properties are eligible
  • Applies to purchases and rate and term refinances

By combining the funds you need for repairs with the funds you need for a purchase or refinance, this dual-purpose loan offers a more cost-effective way to renovate a home.

Having a single mortgage typically means lower closing costs and a lower interest rate.

Plus, you get the convenience of having the cash you need for repairs rolled right in. It’s never been simpler to finance and renovate at the same time.

Fixed-Rate Mortgage

Gives you the peace of mind that comes with a consistent, stable interest rate.

  • Interest rate stays the same for the life of the loan
  • Available with 30-, 20-, 15- and 10-year terms
  • No prepayment penalty
  • Down payment can be as low as 3%

The main value of a fixed-rate mortgage is its interest rate doesn’t change. If interest rates are low, and your credit score is optimal, a fixed rate mortgage could lock in the best rate possible for the duration of your mortgage.

Jumbo Loans

A jumbo loan gives you special terms when you finance more than $766,550.

  • Down payment as low as 10% with no Private Mortgage Insurance, when combined with a second mortgage or line of credit
  • Fixed and adjustable rate mortgage financing available
  • Special financing available for doctors/residents

A jumbo loan lets you take out a larger amount than a traditional mortgage would allow. We’re proud to offer competitive rates to ensure you get the house of your dreams.

Lot Loan Program

Buy your lot now and build later with the Lot Loan Program.

  • Fixed-rate loan
  • Gives a buyer up to three years to close on a construction loan
  • Maximum loan amount: $250,000
  • Lot size can be up to 5 acres
  • Borrower needs to have a Blue Grass Federal Construction-to-Permanent loan in place at end of loan term, or pay the Lot Loan in full

Our Lot Loan Program can help you purchase the land you want now, with the freedom to start building your dream home at a later date. Use this fixed-rate loan to buy up to 5 acres of land without the financial burden of simultaneously paying for construction costs.

Refinance Loan

Looking to refinance your current home mortgage? Refinancing options are available.

  • Available with 10- or 15-year terms 
  • Low closing cost options available
  • Choose a rate and term refinance or a cash-out refinance, even if your current mortgage is with another bank

When you refinance your home, you replace your current mortgage with a new, more favorable one. There are many reasons why refinancing your mortgage could be a good idea, like taking advantage of lower interest rates. You can also leverage your financial position if it’s greatly improved since you were approved for your initial mortgage. 

If you have equity in your home, you may be able to take out a new mortgage for more than what you owe, so you can use the extra cash for other expenses. Refinancing could also eliminate your private mortgage insurance (PMI) payments. 

Other reasons are to avoid a balloon payment or refinance an adjustable-rate mortgage to a fixed term.

USDA Loans

If you’re buying a home in a rural area, qualified buyers can finance 100% of their home’s costs.

  • Fixed-rate loan
  • Owner-occupied, single family and non-farm residences or FHA-approved condominiums are eligible
  • Rate and term refinancing available for existing USDA loans
  • Loan amounts as high as $510,400 for eligible properties
  • Qualified borrowers can finance up to 100% of the appraised value, including most closing costs
  • Property must be located in a designated Rural Development rural area*
  • Your adjusted income may not exceed the Rural Development household limit for the area*

Looking to purchase a single-family home or condo in a rural area? A USDA Rural Housing Loan may be for you. These loans are designed for individuals to get a low mortgage interest rate and qualified borrowers can finance 100% of the home’s cost.

*Refer to the USDA Rural Development website for more information on dedicated rural areas and income limits: www.USDA.gov. Loan is subject to standard USDA underwriting guidelines. Loan is subject to credit approval, other restrictions may apply. An appraisal and homeowners insurance are required.

The Homebuying Process Doesn’t Need to Be a Secret

Download our step-by-step guide on the homebuying process. From making an offer to closing, this guide gives you the information you need to feel comfortable throughout the process.  

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Biddle Family – Residential Construction Lending Testimonial

Lauren and Andrew Biddle went through Blue Grass Federal to build their home. Having the reassurance from Shanda and her team made the process so much easier for them.

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