Conventional loans San AntonioBy admin | June 24, 2017 | Our Services
A Conventional Loans is a mortgage that is not insured or guaranteed, by the federal government. They’re popular with borrowers who have good credit, a stable job, and income, who can afford a down payment, and people who are financially stable overall.
Benefits and Considerations
Government-backed loans like the VA, FHA, USDA and other loan programs are considered for people who can’t afford a substantial down payment, have less than perfect credit, are first-time homebuyers, and others who may need some type of bankrolling assistance.
With a Conventional Loan, Homewood Mortgage LLC. sets the terms of the loan and works with the borrower directly in San Antonio TX. In this situation, Homewood Mortgage LLC has determined the borrower has the ability to make all their payments on time, and will not default on the loan. Government-backed loans, on the other hand, have terms set by the federal government who then assures or guarantees the loan, protecting the lender in the event a borrower defaults on the mortgage.
Conventional Loan Advantages
Conventional Loans are available for new home purchases and refinancing. They can sometimes be harder to qualify for because of additional credit and financial requirements. However, you will generally find they offer much more flexible terms and fewer limits than government-backed loans. Advantages of conventional loans from Homewood Mortgage LLC include:
- They are much simpler to apply and qualify for, with less paperwork, and you’ll have fewer rules and regulations to meet.
- You have a lot more options to choose from, the terms are more flexible and easier to customize and match to your financial situation and goals.
- They can be used for almost all types of properties, from single- and multi-family homes to condominiums and even manufactured homes.
- If you have at least 20% to put down on a purchase, or at least 20% equity when refinancing, you are not required to pay mortgage insurance.
- Conventional Loan rates are often quite low since we know borrower is financially stable and has good credit.
Types of Conventional Loans from Homewood Mortgage LLC.
There are two types of Conventional Loans: fixed-rate and adjustable rate mortgages.
- Fixed-rate loans have an interest rate that does not change the life of the loan. 15- and 30-year terms are the most common. They offer stable, predictable payments that also don’t change. Monthly payments usually very low because they’re spread out over time. They’re great long-term loans if you plan to stay in your house for at least seven or more years.
- Adjustable rate mortgages have an interest rate that does change. There’s an initial up-front period when the rate is fixed, usually one year. During this time, the interest rate and monthly payments are even lower than a fixed-rate mortgage. However, after the initial period, your rate can change or adjust, usually higher, along with your monthly payments. Adjustable rates are ideal for people who don’t plan on staying in their home past the time when the interest rate will change, usually after 3-, 5-, 7- or 10-year terms.