Conventional Mortgage Loans: Benefits, Advantages, And What Can We Do to Make a Difference
There are many questions that surface during the homebuying process, and at the top of the list is “how will I be able to afford this purchase?” There are many loan options available, one of the most common is a conventional mortgage.
What is a conventional mortgage?
A conventional mortgage is a type of loan that is not offered or secured by any government entity. It is offered by a private lender who takes into consideration a borrower’s credit history and credit score. It is often fast and easy to apply for a conventional mortgage. While you do need a healthy credit score — generally above 680 — lenders consider other aspects of your financial well-being too.
Interest rates of a conventional loan may be higher than a Federal Housing Administration (FHA) loan since it’s not backed by the government. However, the private mortgage insurance (PMI) is going to be much lower, as you may be viewed as a more qualified borrower.
Conventional loans can have some of the lowest requirements around. There is one program where borrowers can qualify for a home for as little as 3% down.
“Your home is an asset, a big decision, a big choice,” said Alexander Joyce, president and CEO of ReJoyce Financial. “To take on that amount of leverage and debt, we have to be certain of what we are doing.”
Date Your Rate
Like marriage, buying a home is a long-term decision. The rates are higher right now, but when interest rates come down, you can refinance to a lower rate. “So, in a sense, you are dating your interest rate,” said Tim Ayers, a mortgage loan officer at Grandview Lending. “When you refinance, you may decide it’s a good time to do a cash out to do some home improvements, consolidate debt, or make other investment moves.”
How ReJoyce Financial Can Make A Difference
The homebuying process can be quite overwhelming, especially in this volatile housing market. We are here to help you so that you make an informed financial decision when purchasing a home. If you’d like to schedule your no cost, no obligation visit with the financial experts at ReJoyce Financial, fill out the form below.