Conventional Loans
Overview, Pros, and Cons
Conventional – Agency
Overview
Pros
Cons
Overview
- Typically you can put as little as a 3% down payment and finance as much as 97% of the purchase price/appraised value.
- The agency mortgage tends to have looser underwriting guidelines compared to the agency jumbo mortgage.
- Mortgages aimed at the average borrower with a limit on the loan amount which you can find on this link to Fannie Mae’s website.
- The majority of these loans are sold to Fannie Mae or Freddie Mac no matter where the loan originated from.
Pros
- Besides VA loans, these are normally the most cost effective loan for the borrower if they qualify.
- If mortgage insurance is needed, the insurance premium and term tends to be much lower than the corresponding FHA loan.
Cons
- Not much room for “make sense” underwriting, it either fits in the box or it doesn’t.
- Many banks have requirements in addition to the underwriting guidelines of Fannie Mae and Freddie Mac.
Conventional – Agency Jumbo
Overview
Pros
Cons
Overview
- Typically you can put as little as a 5% down payment and finance as much as 95% of the purchase price/appraised value.
- Mortgages aimed at the average borrower with a limit on the loan amount which you can find on this link to Fannie Mae’s website.
- The majority of these loans are sold to Fannie Mae or Freddie Mac no matter where the loan originated from.
Pros
- Besides VA loans, these are normally the most cost effective loan for the borrower if they qualify.
- If mortgage insurance is needed, the insurance premium and term tends to be much lower than the corresponding FHA loan.
Cons
- Not much room for “make sense” underwriting, it either fits in the box or it doesn’t.
- Many banks have requirements in addition to the underwriting guidelines of Fannie Mae and Freddie Mac.
How Can All Shores Help You?
Whether you’re looking to buy a home, refinance or consolidate debt, we will work with you to find the answer that best fits your needs.
