A mortgage loan not insured by any government program, conventional loans are the most common type of mortgage. They differ from FHA loans and VA loans which are insured by the government. Conforming conventional loans follow the loan amount guidelines set by Fannie Mae and Freddie Mac. Nonconforming loans don't meet those qualifications, but are also considered conventional. Each mortgage lender, bank or mortgage broker will offer different rates, terms and fees for conventional loans, so it's best to get Good Faith Estimates from a number of different places to find the best loan.
A mortgage that has a fixed interest rate for the entire term of the loan. The distinguishing factor of a fixed-rate mortgage is that the interest rate over every time period of the mortgage is known at the time the mortgage is originated. The benefit of a fixed-rate mortgage is that the homeowner will not have to contend with varying loan payment amounts that fluctuate with interest rate movements.
A type of mortgage, commonly referred to as an ARM, in which the interest rate paid on the outstanding balance varies according to a specific benchmark. The initial interest rate is normally fixed for a period of time after which it is reset periodically, often every month. The interest rate paid by the borrower will be based on a benchmark plus an additional spread, called an ARM margin.Contact us for more information>>
Fixed-Rate Mortgages are a good choice for anyone who...
• Wants to take advantage of today's low interest rates.
• Plans on staying in the home for many years.
• Prefers the stability of a fixed monthly interest payment.
Adjustable-Rate Mortgages are a good choice for anyone who...
• Wants to save money on interest payments
• Wants lower monthly mortgage payments
• Wants to consolidate other debts
• Wants to reduce the term of their mortgage
• Wants to invest in home improvements