A conventional loan is a type of mortgage loan that is not insured or guaranteed by a government agency such as the Federal Housing Administration (FHA) or the Department of Veteran Affairs (VA). Instead, conventional loans are backed by private lenders and follow guidelines set by Fannie Mae and Freddie Mac, two government-sponsored enterprises. Conventional loans offer flexibility and may be suitable for borrowers with very good credit and a higher down payment. It's important to work with a lender to determine if a conventional loan is the right fit for your specific needs and financial scenario.
Looking at a down payment for this type of loan is generally higher compared to others. The minimum is 3% to 20% of the purchase price, depending on the lender and borrower qualifications. Credit requirements are much more stricter many will say you need at least a 720 credit score. less than a 20% down payment will require mortgage insurance premium. This insurance is in case borrower defaults on loan. Once reaches 20% equity in home this insurance can be canceled. Loan limits are set by Fannie Mae and Freddie Mac will vary demographically. These type of loans can be used to finance several types of homes such as single family, townhomes, condominiums and investment properties. Your interest rates maybe lower or higher compared to government-backed loans depending on factors such as the borrowers creditworthiness, loan term and loan to value. Seek a trusted advisor to refer a great loan officer if you do not have one.
As a trusted advisor, professional realtor and retired military veteran I am here to serve you in the Dr. Phillips and Central Florida area. Always stay in tuned, educated and connected in this volatile housing market, to purchase or for the sale of your home. In the absence of trustworthy up to date information whether it's a housing crisis or local housing market, real estate decisions are increasingly being driven by fear, uncertainty and doubt. We as trusted advisors drive the real estate community to ensure you are making the right decision.
Part of my job is to keep you informed and educated of the local housing market trends, buying information on the buying and selling process to include real estate common terms and videos. Don't get confused by the media, they talk about national data, I can provide the most current up to date local area data.
So don't let this shifting housing market delay your dreams, data reveals home values typically appreciate over time and that gives your net worth a nice boost. When you are looking for a home, look for your realtor with the heart of a teacher. If you are ready to start your journey, contact me today at 850 496-6412 to begin a new walk to homeownership and all your real estate needs.