Conventional Mortgage

conventional

Mark Svihel & Lake Area Mortgage will do everything possible to get you the lowest mortgage interest rate & closing costs possible. Mark has been doing this for over 25 years!

A fixed-rate mortgage comes with an interest rate that won’t change for the life of your loan. A conventional or sometimes called “conforming mortgages” is a mortgage loan that conforms to established guidelines for the size of the loan and your financial situation. These guidelines are set by Fannie Mae, Freddie mac or the mortgage lender. Conventional mortgages often feature lower interest rates than jumbo loans or what are sometimes called non-conforming loans. FHA mortgage loans or VA mortgage loans also have fixed rate options. But have different credit and loan size guidelines. Usually the loan size for FHA loans is less, depending on where you live. The credit guidelines are more lenient on both VA & FHA mortgage loans.

Monthly payments on a conventional fixed-rate mortgage remain the same for the life of the loan, making it an attractive option for borrowers who plan to stay in their home for several years.

The maximum loan amount for a conforming conventional mortgage is $417,000. This amount is the same nationwide. FHA & VA maximum loan amounts will vary from state to state and county to county.

30-Year Fixed Rate Mortgages

The 30-year conventional fixed-rate mortgages have been the most popular mortgage over the last twenty-five years. They offer a lower monthly payment; however, since the interest payments are spread out over 30 years, you’ll pay more interest over the life of the loan than you would on a shorter-term mortgage. 30 Year fixed rate mortgages generally have a bit higher interest rate than a 15 mortgage, generally .375% to .50% higher. In some cases, a 20-year loan can be .125% lower than a 30-year mortgage.

15 and 20 Year Fixed Rate Mortgages

With a shorter loan term and lower interest rate, a 15- or 20-year fixed-rate mortgage can help you pay off your home faster. It also allows you to build equity in your home at a much faster rate, due to the shorter term and amortization. But remember, you payment will be much larger than with a 30-year loan. The 15- and 20-year fixed-rate mortgages are especially popular for refinancing.

Do you have additional questions for Mark? Call or email Mark today.