A conventional mortgage is a more common type of loan that isn’t guaranteed by the government. Instead, private lenders back these loans with insurance paid for by you as the borrower. Over the last three years, over 70% of new home purchases were made with this kind of financing because it’s available and affordable to most people looking to buy their first property.
Conventional loans can broadly be categorized into two types -conforming and non-conforming conventional loans.
For a person to be considered for a conforming conventional loan, Fannie Mae and Freddie Mac requirements must be met. These requirements include the loan limit, which may depend on the location of the property. Non-conforming conventional loans, on the other hand, are not bought by Fannie Mae or Freddie Mac as they do not meet the amount requirements, instead, they are funded by lenders. Other types of conventional loans include ARMs, fixed rates, and jumbos.
As an experienced Upstate and Western New York mortgage broker, we will advise you accordingly on the type of conventional loan that best suits your needs. We want to make the process as easy for you as possible by guiding you through it with personalized support.