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Conventional loans: Is it right mortgage option for you? Know-how before proceeding!

Yes, definitely you need a mortgage to buy a home. But did you know that there is not one size type of home loan everyone gets when you go to make a purchase? There are numerous types of home loan products.

The most popular type of loan among all the home loans is conventional loans. It is a type of loan that is not backed by the government. Conventional home mortgages are pretty standard to what everyone thinks of what they say MORTGAGE. These loans can have a fixed rate as well as an adjustable rate. These loans don’t come with any special bells and whistles, and compared to other loan products, qualification criteria of this type of home loan can be pretty strict. If you are in search of the best lender to provide you easy approval and lowest rates home loans, then Easy Mortgages is the optimum place to be reached. Get instant approval of your loan with minimal documentation exclusively at Easy Mortgages! Let’s go over the benefit and considerations you should look for when deciding on a home loan type.

Why go for a Conventional mortgage?

Conventional loans are of two flavours: Conforming and non-conforming. Conforming means the finance will be sold from your lender to Fannie Mae or Freddie Mac. This happens with smaller loans as these types of loans are easier for banks to sell.

And on the other side a non-conforming loan is a mortgage that is not sold to Fannie Mae or Freddie Mac since the loan is so large. The main diversity between the conforming and non-conforming loans is that with a larger loan comes more scrutiny of your credit score and stricter lending requirements.

The biggest benefits to a conventional mortgage include:-

1. Flexible term options: you can prefer to pay off the home on any timeline between eight and thirty years

2. No private mortgage insurance once you reach 80% equity in the home or else if you make 20% down payment

3. Buyers can obtain into a home with as low as 3% down payment

4. Higher loan amounts

5. Procurable for any type of home: a vacation, rental, or primary residence

Qualification required for a conventional mortgage

One of the biggest back points for a conventional type of mortgage is the stricter lending requirements. To qualify for this type of loans you require:

· 2 years of solid employment history

· 2 to 3 months of estimated mortgage payment in savings

· A minimum 620 credit score

· A minor debt-to-income ratio; around 43% is the max

Is it right for you?

Actually, it depends on many factors. A conventional loan may be the best alternative for you if you have a good credit score as well as a nice down payment saved. With a conventional mortgage you also get more flexibility: depending on how much you choose to pay in down payment, you can secure lower interest rates as well as avert paying extra each month in private mortgage insurance.

Have more queries? If yes, then visit our official website now!

#non conventional loans

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