LOAN PROGRAM
Conventional
Conventional mortgages are a popular option for homebuyers who have strong credit and can afford a larger down payment. They offer a variety of loan options and repayment terms, and can be a good choice for borrowers who want to avoid government restrictions and fees.
Loan Type
Conventional mortgages are not guaranteed by the government and are backed by private lenders such as banks, credit unions, and mortgage companies.
Down Payment
Conventional mortgages usually require a down payment of at least 3% to 20% of the purchase price, depending on the lender’s requirements and the borrower’s creditworthiness.
Credit Score: The minimum credit score required for a conventional mortgage is typically around 620, but some lenders may require a higher score depending on the borrower’s financial situation.
Loan Limits
Conventional mortgages have loan limits set by Fannie Mae and Freddie Mac, which vary depending on the location of the property.
Interest Rates
The interest rates for conventional mortgages can be fixed or adjustable, and are determined by the lender based on the borrower’s creditworthiness, loan amount, and down payment.
Mortgage Insurance
Borrowers with a down payment of less than 20% are usually required to pay private mortgage insurance (PMI), which protects the lender in case of default. PMI can be canceled once the borrower reaches 20% equity in the property.