Conventional means that a loan is not a part of a specific government program. Loans can either be conforming or non conforming.
There are a lot of conventional loan programs out there and finding the right one does not have to be difficult. Fannie Mae and Freddie Mac’s lending guidelines require a minimum FICO credit score of 620. They require no mortgage insurance if the loan to value ratio is under 80%.
Conventional loans have stricter guidelines than FHA loans, but allow borrowers to get loans for owner occupied and investment properties. Conventional loans do not require the upfront mortgage insurance premium, which is currently 1.75 percent of the loan amount. Conventional appraisals are looser on guidelines than FHA Mortgages.
Conventional Loan Programs:
Cash Out/Debt Consolidation – Have equity in your home? Want to take cash out? The annual percentage rate is usually a lot lower than a small loan. This requires an appraisal and for a conventional loan you have to stay under 80 percent loan to value ratio (LTV)/75 percent for investment.
The market for housing was soaring in the 1990s to 2007. The financial crash in 2008 hit the real estate market, credit and banking hard. Values decreased significantly and left people with mortgages under water – owing more than their house is worth. If you owe more than your house is worth, this may be a good option for you to save money on your mortgage payment without paying mortgage insurance.
Use the following list to see if your conventional conforming loan is eligible for HARP:
All loans are subject to credit, underwriting and property approval guidelines. Offered loan products may vary by state. There is no guarantee that all borrowers will qualify. Restrictions may apply. This is not a commitment to lend. Terms, conditions and programs are subject to change without notice. Nationwide Mortgage & Realty, LLC is not acting on behalf of or at the direction of HUD/FHA or any government agency. CO: Check license status of your mortgage loan originator atwww.dora.state.co.us/real-estate/index.htm. Also licensed in: FL. VA, and TX: NMLS ID 276777. Illinois Residential Mortgage License | MB. 6760210. WA: Consumer Loan License MB-276777. GA: Georgia Residential Mortgage Licensee 60857