Conventional loans are mortgage loans that are not insured by the government (like FHA, VA, USDA Loans), but they typically meet the lending guidelines that have been set by Fannie Mae or Freddie Mac. Typically, conventional loans have better rates, terms and/or lower fees than other types of loans. However, conventional loans typically require a borrower to have good-to-excellent credit, reasonable amounts of monthly debt obligations, a down payment of 5-20% and reliable monthly income. Conventional loans are ideal for borrowers with excellent credit and at least a 5% down payment.
Buying a home using a conventional mortgage can take up to a few weeks for the whole process. At first, you’ll start by filling out an application. If you work with a conventional loan officer from Superior Rate Mortgage of New England, you’ll get the benefit of our experience and access to multiple loan programs. This lets you shop the lowest conventional loan rates and get the best mortgage for your needs. We are licensed to work with borrowers in Massachusetts, Rhode Island, New Hampshire and Connecticut.
If you meet the initial requirements for conventional mortgage loans in Massachusetts or a neighboring state, we’ll show you tailored options for conventional mortgage rates and other terms. You can use this information to help you determine how much you might get in a loan.
If you agree to the terms and are ready to buy a specific property, we can start the underwriting process, which is a detailed look at your finances and the transaction. This may take a few days or longer, depending on the information we need. Once every box is checked, we can set a date to close on the loan.
Fixed Rate Mortgages: Your rate and payment never change.
Adjustable Rate Mortgages: After the initial period your interest rate can change once a year.
For Purchase transactions, a conventional loan down payment usually requires the home-buyer to pay at least 5% - 20% of the purchase price of the home. For a Refinance transaction, most lenders require at least 10% equity in the property. If you don't have enough equity to qualify for a conventional refinance - even if you owe more than your home is worth - you might be eligible for a HARP 2.0 Loan.
Most conventional loan programs allow you to purchase single-family homes, warrantable condos, planned unit developments, and 1-4 family residences. A conventional loan can also be used to finance a primary residence, second home and investment property.
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