- Conventional mortgages are very popular because of their flexibility for larger loans.
- Conventional loans are not guaranteed or insured by any government agency.
- Conventional or jumbo loans are the only options available for loans greater than the limits set by Fannie Mae and Freddie Mac, which is $417,000 in most areas.
- Conventional loans have stricter qualification guidelines and are ideal for borrowers who have strong credit scores.
- Conventional Loans typically require a minimum of a 5% down payment.
- Conventional loans are available as Adjustable Rate or Fixed Rate mortgages and have 15, 20, and 30 year terms.
- For a fixed rate conventional or jumbo mortgage, the interest rate remains fixed for the life of the loan. The payments also remain level for the life of the loan and are structured to repay the loan at the end of the loan term.
- Conventional loans with down payments less than 20% may require Private Mortgage Insurance (PMI).
- Borrowers are allowed to have 3% seller concessions for purchase loans.
- Conventional / Jumbo mortgages are the only options for borrowers who want to borrow more than the Fannie Mae and Freddie Mac limit of $417,000, in most areas.
- Conventional / Jumbo mortgages have a wide variety of programs available to borrowers including Adjustable and fixed rate mortgages with a wide range of terms.
- If you have a strong credit profile and can make a 20% down payment on your home, Conventional / Jumbo loans can offer you the most competitive rates in the market.
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