CONVENTIONAL MORTGAGES
Conventional loans are funded by private financial lenders and then sold to government-sponsored establishments such as Fannie Mae and Freddie Mac. A conventional loan can be a good choice if you have a high credit score. You can potentially lower your mortgage payments by avoiding PMI if you have 20% down payment. These types of loans usually have more requirements than FHA loans. You’ll normally need a higher credit score and a lower debt-to-income ratio (DTI) to qualify for a conventional loan than you would with an FHA loan.
A conventional loan is our most popular mortgage option for borrowers looking to purchase or refinance a home. They are not guaranteed or insured by any government agency and conform to the loan limits set by the Federal Housing Finance Administration (FHFA).
Conventional Loan Benefits
- Down payment can be as low as 3%.
- Down payment of at least 20%, can help you avoid paying private mortgage insurance (PMI).
- You can normally borrow more money than FHA loan.
- Some conventional loan allows 100% gift as down payment
Helpful Mortgage Tools
When it comes to credit, more information generally means more consumer empowerment. That’s why we’re excited to introduce a new education video series from FICO called Understanding Your Credit.
Credit can be confusing and complex. We’ve created these four initial short videos to help you better understand FICO® Score basics.
Credit reports are the foundation of FICO® Scores, but what are they exactly? Watch this video to find out which information on credit reports does and doesn’t impact FICO® Scores.
Every day, thousands of U.S. lenders use FICO® Scores to make more well-informed, credit-granting decisions. What does that mean? Why is it important to understand how lenders use them? This video takes a look at what a FICO® Score is and why it matters to consumers and lenders alike. Watch it to learn how FICO® Scores streamline the lending process, making it faster and fairer.
Whether applying for a credit card, mortgage, or auto loan, there’s a good chance the lender is using FICO® Scores to help make their approval decision. The good news is, FICO® Scores are ultimately in the individual’s hands — they’re based on credit habits and behaviors. That’s why understanding what goes into FICO® Scores is a vital part of credit health. Watch this video to learn the five key categories that factor into FICO® Scores.