Conventional Home Loans
A conventional loan is a home loan for individuals who have steady income, good credit and have funds available for a down payment. A conventional loan requires a 5% down payment. The Copeland Mortgage Team in Lee's Summit, MO helps buyers secure a conventional loan when purchasing property.
A conventional loan is not insured by the federal government (like USDA, FHA and VA loans) and can be the preferred route to home financing for many homebuyers and those purchasing investment property. Those who are purchasing their first homes, an additional home or even investment property often turn to a conventional loan.
What to Expect When Applying for a Conventional Loan
Typically, a conventional loan requires that borrowers have 5-20% of the home's value as a down payment. Lenders who sell conventional loans review debt/income ratios and monthly housing costs. Also reviewed in the conventional loan application are credit scores, credit history and income over the past several years. Those who have gone through bankruptcies and foreclosures at least four years ago are eligible for a conventional loan, but must have excellent credit histories. Most loan programs review each applicant based on the Fannie Mae and Freddie Mac guidelines. The application process goes quicker than FHA loans or VA loans since the government isn't involved in the application process.
Typically, we will review the following items with you when applying for a conventional loan:
- Your Employment (Is your income and employment steady?)
- Down Payment (How much can you afford to put down?)
- Credit History (Is your credit good, do you have late payments?)
In addition, we can discuss your options for mortgage insurance and setting up an escrow account, which will allow you to have your mortgage insurance, homeowners insurance and property taxes taken out as part of your monthly mortgage payment.
Conventional Loan Terms
Conventional loans are available in fixed-rate or adjustable-rate (ARM) loans and have a term of 15, 20 or 30 years. The shorter the term, the lower the rate. Homeowners with conventional loans find their equity builds up quicker since a larger down payment is needed.
To see if you prequalify for a conventional home loan, contact Darren Copeland today at 816-268-4025.
Learn about the Home Buying Process from Fannie Mae, and then get preapproved for a conventional loan from The Copeland Mortgage Team in Lee's Summit, MO!