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Conventional mortgages are home loans that are not issued by, nor insured by, or guaranteed by the federal government.
Conventional, or conforming mortgages, follow the guidelines set by Fannie Mae and Freddie Mac.
The maximum loan limits for conventional mortgages vary from county to state and can be found here: Fannie Mae Loan Limits
Conventional loans can either be fixed or have an adjustable rate.
It is possible to get a hybrid adjustable rate mortgage, where the first 3, 5, or 7 years of the loan is fixed. After that the loan turns into a fully adjustable mortgage for the remainder of the term.
An adjustable rate mortgage (ARM), usually has a term of 30 years and it comes with a low introductory rate, better known as a teaser rate.
Conventional mortgages have credit score requirements of 620 or greater.
If you wish to have no monthly payments for mortgage insurance, you must put down at least 20% of the loan amount as the down payment.
It is possible to obtain the loan with 10%, or even 3% down, but the loan will come with mortgage insurance.
|Mortgage payment stays the same for the entire life of the loan||620+ credit score|
|No mortgage insurance required if you have more than 20% equity||Higher interest rates vs VA & FHA|
|Lower cost vs. other loans||Large down payment|
|Lower mortgage insurance premium vs. FHA (if required)||Requires mortgage insurance if your equity is less than 20%|
|No up front mortgage insurance like FHA loans require||Lower debt to income qualification ratios|
Start our easy loan application process today and take one step closer to home ownership.
Phone: (661) 799-8515