Conventional Loans
What Is A Conventional Loan?
Conventional means that the loan is not part of a specific government program. Conventional loans typically cost less than FHA loans but can be more difficult to get.
There are two main categories of conventional loans: Conforming and Non-conforming.
Conforming loans
Conforming loans have maximum loan amounts that are set by the government. Other rules for conforming loans are set by Fannie Mae or Freddie Mac, companies that provide backing for conforming loans.
Conventional (Conforming):
-
$766,550 in most counties
-
Most common loan type
-
Loan amount must be $766,550 or less in most counties and may be as high as $1,149,825 in high-cost counties
-
If your down payment is less than 20%, you’ll typically need mortgage insurance
Conforming Jumbo:
-
$766,550 to county limit
-
Conforming loan for amounts higher than $766,550
-
Only available in certain counties
-
Maximum loan amount varies by county
Non-conforming loans
Non-conforming loans are less standardized. Eligibility, pricing, and features can vary widely.
Mortgage insurance is required for some conventional loans.
Jumbo (Non-conforming):
-
Jumbo loan for amounts greater than the Conforming Jumbo limit in your county, up to $1-2 million
-
Rules vary, but usually need good credit and a high down payment to qualify
Non-conforming (other):
-
Loans of any size that do not fall into another category
-
Some loans in this category are intended for borrowers with credit challenges. These can include:
-
Loans that allow for minimal documentation of your income
-
Loans that allow you to pay only the interest or allow your loan balance to increase
-
-
Can include programs for mainstream borrowers with unusual circumstances. These can include:
-
Loans for properties with non-standard features (such as more than 10 acres of land, properties with agricultural income, or properties that are difficult to appraise)
-
Loans for customers with complex finances, such as self-employed borrowers, or newly graduated doctors
-
This is not an offer for extension of credit or commitment to lend. All loans subject to program guidelines and final underwriting approval. Not all applicants qualify. Information and pricing are subject to change at any time and without notice. This offer cannot be used in conjunction with any other promotion. The content in this advertisement is for informational purposes only. Consult your mortgage loan consultant for further information. If any other entities are mentioned in this advertisement, they are not an affiliate of First United Bank or First United Mortgage Group. NMLS 400025. Copyright © 2024 First United Bank. All Rights Reserved.