Conventional Home Loans
Conventional mortgages are loans that are insured by private companies. Typically, these loans meet the funding criteria set by Fannie Mae and Freddie Mac. There are a number of conventional loan types offered by First Home Mortgage. Tim Sisson of First Home Mortgage is a leading provider of Conventional mortgages and provides competitive rates and flexible financing options. Tim does Conventional loans in Dunkirk, Huntingtown, Prince Frederick, as well as the entire state of Maryland. For more information on Conventional loans or how to get Pre-Qualified, contact Tim today at 301-327-5817 or click here!
A fixed-rate mortgage has an interest rate that stays the same for the entire life of your loan. This offers a predictable monthly payment for a term of 10 – 30 years.
– Interest rate security
– Monthly payment stability
– Best for buyers planning to stay in their homes for a long time
Adjustable rate mortgages (ARMs) may allow you to lock in a low, introductory interest rate that could increase over time. A hybrid ARM offers a fixed period (typically 3-10 years) followed by a yearly adjustment to the interest rate. Hybrid ARMs are often represented by fractions, such as 5/1 – meaning the first rate reset takes place after five years and continues to reset each year for the life of the loan.
– Low starting interest rate
– Lower monthly payments during the initial term
– Best for buyers planning to keep their loan for a shorter period
WHY A CONVENTIONAL LOAN?
With an above average credit score and qualifying debt to income ratios a Conventional loan is more beneficial than Government products in the long term. Firstly, there is no up front premium to be paid on a Conventional loan. FHA (Upfront MIP), VA (Funding Fee) and USDA (Guarantee Fee) all have up front premiums that are often financed into the loan, whereas Conventional loans do not require anything like this. Secondly, there is flexibility for the manner in which the PMI can be paid. It can be paid Monthly, in one lump sum – or “Single Premium”, or Lender-Paid. The Monthly premium is automatically dropped at 78% Loan to Value, and you can apply to have it removed at 80% Loan to Value. This is different form FHA and USDA monthly installments which are paid throughout the life of the loan.
If you are a potential borrower who has solid credit history as well as the funds to put at least 5% down, a Conventional loan is certainly advantageous.
Fannie Mae HomeReady | Freddie Mac HomePossible
– Eligible homebuyers can purchase a home with as little as 3% down with the 97% financing product through Fannie Mae or Freddie Mac.
– There are income restrictions in certain areas. Check your eligiblity here:
Tim Sisson of First Home Mortgage is a leading provider of Conventional mortgages and provides competitive rates and flexible financing options. Tim does Conventional loans in Dunkirk, Huntingtown, Prince Frederick, as well as the entire state of Maryland. For more information on Conventional loans or how to get Pre-Qualified, contact Tim today at 301-327-5817 or click here!