Conventional Conforming Loans

Conventional Conforming loans can be made to purchase or refinance  single family to four family homes.  In general, Fannie Mae and Freddie Mac’s single family, first mortgage loan limit is $417,000. This limit is reviewed annually and, if needed, changed to reflect changes in the national average price for single family homes.  Fannie Mae and Freddie Mac also offer Conventional Super Conforming programs for loan amount > $417,000.00 and < $625,500.00 for high costs areas. The loan limits could vary from county to county. Please check with your mortgage professional for the loan limit in your county.  Super conforming loans  have a slightly higher interest rate than regular conforming loans.

Conventional Jumbo Loans

Because Jumbo Loans are not funded by the government sponsored entities (GSEs) such as Fannie Mae or Freddie Mac, they usually carry a higher interest rate and some additional underwriting requirements. A strategy to lower your overall interest payments if your purchase or refinance balance is above $417,000 or $625,500 for the high cost areas is to use a combination of both first and second mortgage, referred to as an 80/10/10, 80/15/5 . Every situation is different, but it is one more option to consider.

In addition to common loan structures such as fixed rate, adjustable rate, Fannie Mae and Freddie Mac also have loan programs for low to no down payments, community lending and affordable housing initiatives, construction to permanent, home improvement and reverse mortgages.

Loan Terms

Both conforming and Jumbo loans offer 30, 20, 15 and 10 year fixed rate.  There are also mortgages that combine aspects of fixed and adjustable rate mortgages – starting at a low fixed rate for 5, 7, 10  years, for example, then converting to an Adjustable rate mortgage for the remaining term of the loan adjusting to market conditions. Ask your mortgage professional about these and other special kinds of mortgages that fit your specific financial situation.

Call me directly @ 858-750-0931 for a free consultation.

“By Ed Eissa”