Conventional Loans

Mortgages are Defined as Either Government-Backed or Conventional

Government backed loans utilize Government agencies like the Federal Housing Administration (FHA) and the Department of Veterans Affairs (VA) who insure home loans. The insurance is paid for by fees collected from mortgage borrowers.

Mortgages not guaranteed or insured by government agencies are conventional home loans. Conventional loans are held and backed by the mortgage lender.

Conventional Mortgage Benefits

  • 2022 Conforming Loan Limits California is $647,200

  • No up-front private mortgage insurance (PMI).

  • Flexible guidelines on the homes condition

  • PMI payments cancel when the LTV reaches 78%

  • NO PMI with a downpayment of 20%

  • Mortgage insurance is less expensive (0.51% vs 0.85% with FHA)

Disadvantages of Conventional

  • Reserve funds are often required

  • 620 credit score requirement (higher than FHA)

  • Large down-payment 10.01%-20% (Unless you qualify for a Conventional 97 loan which requires a 3% down payment)

 

We will guide you through the various options on the market and help you find the right mortgage for you.

Whether you are a first time buyer, looking to refinance, looking for your dream home, or downsizing an empty nest – put my 34 Years of Industry Experience to work for you.