A Conventional Mortgage is a great option if you have excellent credit.
It is possible to purchase or refinance a home with at little as 5% equity. A conventional fixed rate is a great option for a consistent payment over the life of the loan.
Conventional loans are traditionally best for borrowers with excellent credit or a substantial amount of equity. You can potentially be approved for a Conventional loan with a credit score of at least 620.
What is a Conventional Loan
A conventional loan means that the loan meets the requirements of Fannie Mae or Freddie Mac. Fannie and Freddie are Government Sponsored Enterprises that purchase and securitize mortgage loans. If your loan is eligible to be sold to Fannie or Freddie, you are typically able to obtain a lower rate than you would with a non-conforming mortgage loan.
What is required for a Conventional loan?
Conventional loans require a standard set of documentation that typically includes an appraisal, employment documentation and verification of your debt-to-income ratio. You must have a credit score of at least 620 and must meet the requirements of Fannie Mae or Freddie Mac. You will be required to maintain Private Mortgage Insurance (PMI) if you do not have 20% equity.
How do Conventional Loans Work?
- Purchase or refinance a home with as little as 5% equity
- You are able to pre-pay your mortgage at any time with no prepayment penalty
Have Questions?
Give us a call at 888-404-4488. We have mortgage specialists standing by to answer any questions you might have.
