Conventional Loans

  A conventional loan is a mortgage loan that's not backed by a government agency. While some government-backed loans provide unique benefits to homebuyers, conventional loans remain far and away the most common type of mortgage.

Competitive rates

Low Down payment options and gift funds allowed.

Options include primary or second homes, investment properties, cash-out refinances and more.
Homebuyers who use a conventional mortgage with a down payment of less than 20 percent usually are required to get private mortgage insurance.

The lender or servicer must automatically terminate PMI when your mortgage balance reaches 78 percent of the original purchase price — in other words, when your loan to value drops to 78 percent. This is provided you are in good standing and haven’t missed any mortgage payments.

Types of conventional loans 

Mortgages that fall within the FHFA’s limits are called conforming loans. This means that they are able to be bought by Fannie Mae and Freddie Mac, two government-sponsored enterprises (GSEs), through the secondary mortgage market. By selling these types of loans to Fannie Mae and Freddie Mac, lenders obtain the capital to continue to make new mortgages.

Jumbo Loans

Mortgages that exceed conforming limits are called jumbo loans or nonconforming loans. These are loans that can’t be sold to Fannie or Freddie, but they are still available to well-qualified borrowers who need a more flexible conventional loan option.

Non-qualified mortgages

Non-qualified mortgages, or non-QM loans, also cannot be purchased by Fannie or Freddie, but they can be an option for those who are able to afford a mortgage but maybe are unable to meet the credit or DTI requirements. Because it doesn’t have to meet conforming loan standards, the lender can be more flexible when qualifying a borrower. It’s important to note, though, that non-qualified mortgages often come with higher interest rates.

Requirements, information, and programs are subject to change without notice.  Please contact us for more information.

We are your Mortgage Broker in Jacksonville FL