Conventional Loans

A conventional mortgage is a home loan that is not insured or guaranteed by a government agency such as FHA, VA, or USDA. Instead, conventional loans are issued by private lenders and typically follow guidelines established by Fannie Mae and Freddie Mac.

These loans are among the most common financing options and are ideal for borrowers with strong credit profiles and stable income.

How Conventional Loans Work

Conventional mortgages generally adhere to Fannie Mae (Federal National Mortgage Association) and Freddie Mac guidelines. These entities purchase loans from lenders, which helps keep mortgage rates competitive and sets standardized requirements, including maximum loan amounts and borrower qualifications.

Conventional loans are available in a variety of terms, with the most common being a 30-year fixed-rate mortgage. A fixed-rate loan offers an interest rate that remains consistent throughout the life of the loan, providing predictable monthly payments.

Key Benefits of Conventional Financing:

• Competitive interest rates

• Flexible loan terms (30-year, 20-year, 15-year options available)

• No upfront mortgage insurance premium

• Private Mortgage Insurance (PMI) may be removed once sufficient equity is reached

• Higher loan limits compared to many government-backed programs

• Suitable for primary residences, second homes, and investment properties

Conventional financing can be an excellent choice for borrowers seeking long-term stability, flexibility, and potentially lower overall costs depending on credit profile and down payment.

I work closely with clients to evaluate whether conventional financing or a government-backed alternative best aligns with their financial goals and long-term strategy.