Lori was WONDERFUL as usual – I never have any doubts referring her customers. She treats them like family... That includes yelling at them when they don't get the documents she requested!
– Pam M. of Century 21 Real Estate
are basically any mortgage which is not guaranteed or insured by the US Government. These are traditional home loans made by lenders and held by lenders and other financial institutions.
Qualification requirements for conventional loans and the types of borrowing scenarios they support may provide more flexibility to borrowers which may mean more borrowing options or terms better suited to the situation.
Typically, though Conventional Loans require a larger down payment for home purchases.
Some key advantages of Conventional Loans:
- Lower market interest rates may be available depending on the
- Seller contributions are allowed
- More flexible underwriting (more creative financing options)
- May finance vacation/second homes
- May finance investment properties
- Lenders may be willing to reduce or eliminate certain loan fees
- Appraisals may not be as strict as with the FHA or VA required appraisals
- Private Mortgage Insurance (PMI) may be available which
allows a lower down payment
The loan amount for "Conforming Loans", which conform to the guidelines set by Fannie Mae and Freddie Mac, is $417,000 for Single Family residences (there are exception for Alaska and Hawaii), although much more can be borrowed with Conventional Loans.
Conforming Loans typically give the borrower the best rates and terms. Refer to the Jumbo Loans page for more information on high balance conventional loans.
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