Conventional Loan

Conventional Mortgage Loans are underwritten to guidelines set forth by Fannie Mae and Freddie Mac.

They are by far the most popular mortgage loan type used to purchase and refinance residential real estate. However, they not the best loan option for everyone. Clients with less than perfect credit seeking a low down payment mortgage will be happy to know we have other options to better fit their needs.

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Who can get a Conventional Loan?

Almost anybody can get a Conventional Loan. There are no income limits and it will provide financing on 1-4 unit residential properties to be used as primary residences, second homes, and investment properties. To qualify for a Conventional loan, you’ll need a minimum 620 credit score and maximum debt to income ratio of 45% (exceptions made up to 50% with compensating factors). The interest rate and closing cost structure of Conventional loans are best suited for clients with high credit scores and/or large down payment/equity.

Benefits of Conventional loans:

  • Buy a home with as little as 3% down

  • Refinance loans up to 95% of the current value of your home

  • Multiple mortgage insurance (PMI) options available

  • Clients with a previous bankruptcy can qualify 4 years after discharge

  • Clients with a previous foreclosure can qualify 4-7 years after Sheriff’s Deed Transfer

  • More lenient property condition requirements than other loans