A conventional mortgage is by far the most popular mortgage loan, and I am sure you have heard this term while researching purchasing your home. One of the first thing to understand about conventional mortgages is knowing they are not federally guaranteed loans. They offer a wide range of benefits, can be slightly tougher to qualify for than a government loan and the best option for those with strong creditworthiness. There are two types of conventional loans we will discuss the overview of these below.
Conventional Mortgage Loan:
- Conventional mortgages require the borrower to meet the income requirements set by FreddieMac and FannieMae and must follow the loan limits set be the Federal Housing Finance Administration.
- As a borrower you will need to have a higher credit score to qualify this is typically 620** and above.
- Depending on the house and your finances you may be required to put a higher down payment on your home for the loan.
- You have a vast selection of homes that qualify for this type of loan that do not have to follow government rules and regulations for listing the home.
- With a conventional mortgage loan, you can structure the loan’s interest and payments using 30-to-5-year payment plan and lower interest rates with larger down payments.
- There are no government program fees tagged on to the loan.
Conventional Mortgage Loan:
- These loans are sometimes called Jumbo loans
- Non-Conventional Mortgage loans can include individuals or borrowers with poor credit or a high debt ratio over income. Some can include recent bankruptcy.
- This type of loan can vary widely by lender, please call to discuss in detail with one of our Lendevity loan advisor.
No matter what type of home loan you are selecting Lendevity is there to help you work through the details. We know your decision will have an impact on you or your family’s financial future. It is important to learn about all your options. Contact us today to discuss your options.
