Conventional Mortgage Loan | What Is A Conventional Mortgage Loan?
What is a conventional loan?
“What’s a conventional loan?” The Federal Government does not back a conventional loan. Because the Federal Government does not back it, it allows you to shop for a conventional loan through private banks, credit unions, mortgage brokers, and lenders. However, this loan puts more risk on the lenders, which is why it can require a higher down payment and higher credit score to qualify.
Qualifying for a conventional loan.
While you can purchase a home with as little as 3% down with a Fannie Mae or Freddie Mac loan, they do have limits to how much you can borrow, and every county is different. For example, here in San Bernardino County, the loan amount limit is $453,100. Now, the purchase price of the loan amount over in LA County is at $679,500. Much higher and way different. So it depends on the county. The guidelines are the same regardless of the county. You have a debt ratio that you must meet along with a minimum 620 FICO score. The down payment or reserves are dependent on your credit score. So, here’s what I recommend, you call me Chris Trapani the mortgage pro and I’ll sit down with you. We’ll help you figure out what’s the best program for you, the cheapest rate, the most inexpensive monthly payment and best long-term and short-term situation. So, let’s put the package together.