CONVENTIONAL HOME LOANS
Pauling Homes Team is not a financial institution, but we work closely with First Class Mortgage as a trusted partner and lender.
Conventional mortgage loans are mortgages that are not insured or guaranteed by the federal government. Conventional loans boast great rates, costs, and home buying flexibility. 60% of mortgage applicants use this loan program. Conventional loans are also known as conforming loans, since they conform to a set of standards set by Fannie Mae and Freddie Mac.
Conventional loans can be fixed or at an adjusted rate. Fixed-rate mortgages have set interest rates for the entire length of the mortgage term which can be between 10 and 30 years. an adjustable-rate mortgage (ARM) has a term of 30 years with a low introductory rate for fixed period followed by periodic adjustments. Generally the conventional loan limit is $726,200.
Benefits
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Use a conventional loan to buy or refinance a primary, secondary, or rental
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Available in fixed or adjustable rates (ARMs), and offer many loan terms usually from 10 to 30 years
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Down payments as low as 3%
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No monthly mortgage insurance with a down payment of at least 20%
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Can have lower mortgage insurance rates than FHA loans
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Mortgage insurance is cancel-able when equity reaches 20%
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Buyers using conventional loans are more attractive to sellers
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Can have a non-occupant co-borrower
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May allow gift or grant for all or a portion of the down payment or closing costs
How to qualify
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620 credit score or higher
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Down payment of 3%-20%+
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DTI below 50%
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Foreclosures: 7 year waiting period
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Short sales: 4 year waiting period
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Bankruptcy: Chapter 7- 4 year waiting period
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Bankruptcy: Chapter 13- 2 year waiting period from discharge date
