A conventional loan is a mortgage that is not backed or insured by the government, including all Federal Housing Administration, Department of Veterans Affairs, or Department of Agriculture loan programs. Conventional loans typically have fixed interest rates and meet the down payment and income requirements set by Fannie Mae and Freddie Mac, and follow the loan limits set by the Federal Housing Finance Administration. (FHFA)
Currently, conventional mortgages represent around two-thirds of the homeowners’ loans issued in the U.S. At FlexPoint, Inc, we have years of experience in providing Conventional loans to individuals across the nation who are purchasing a new home.
People with established and good credit that are sound financially usually qualify for conventional mortgages. Specifically, the ideal candidate should have:
- Good to excellent credit. The higher the credit score, the better rate terms a borrower will receive.
- An acceptable debt-to-income ratio (DTI).
- A down payment of at least 20% of the home’s purchase price.