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Conventional Mortgage — for borrowers with higher credit scores who can put more money down

The conventional loan comes with either a fixed or adjustable rate and is not guaranteed by the U.S. Government, unlike VA, FHA, and USDA loans. A few additional details:

  • Also known as Conforming Loans, conventional mortgages conform to guidelines set forth by either Fannie Mae or Freddie Mac, rather than by the lender.
  • Reliant will continue to service your loan (i.e. to collect payments and pay escrows) even after Fannie Mae acquires it.
  • If you put down less than 20% on the purchase price, you’ll need to purchase Private Mortgage Insurance (PMI), which will increase your monthly payment somewhat.
  • The maximum mortgage amount for a single-family home is $417,000.

Qualifying for a conventional mortgage can be more challenging, but the rewards are worth it! Let’s take a look at the benefits of a fixed-rate conventional loan.

  • Lower overall monthly mortgage payment than FHA options
  • Flexible sources of funds for closing
  • Eligibility for primary residences as well as vacation and investment homes
  • Down payments as low as 3%
  • Mortgage term options from 10–30 years
  • Most borrowers are able to cancel PMI in time

Wondering about the benefits of an adjustable-rate conventional mortgage?

  • Lower interest rates during the initial, fixed-rate period translate to lower mortgage payments starting out
  • Payment of additional funds to reduce the balance will lower the payment after the initial period
  • Least expensive option for shorter-term ownership, such as designed relocations