What is a Conventional Loan?
A conventional loan is any mortgage that is not guaranteed or insured by the federal government.
A conventional loan is generally referring to a mortgage loan that follows the guidelines of government sponsored enterprises (GSE’s) like Fannie Mae or Freddie Mac. Conventional loans may be either “conforming” or “nonconforming”. Conforming loans follow the terms and conditions set by Fannie Mae and Freddie Mac. Non Conforming loans don’t meet Fannie Mae or Freddie Mac guidelines, but they are also considered conventional. Whether you’re buying a home or want or refinance your mortgage, a conventional loan might be right for you. If you’re unsure about your credit rating, or have concerns about a down payment, conventional mortgages can give you peace of mind with super low closing costs and flexible payment options.