Conventional Mortgages
Joann Ton
LOAN OFFICER
NMLS# 1461031
Conventional Mortgage Topics Covered
- What is a Conventional Mortgage?
- Conventional Mortgage Requirements
- Private Mortgage Insurance (PMI) on a Conventional Mortgage
- Types of Conventional Mortgages
- Conventional Mortgage Advantages
- Conventional Mortgage FAQs
What is a Conventional Mortgage?
A conventional mortgage is one that’s not guaranteed or insured by the federal government. Instead, they are available through private lenders, such as banks, credit unions, and mortgage companies.
Conventional mortgages have a fixed rate of interest, which means that the interest rate does not change throughout the life of the loan. This gives Los Angeles homebuyers a sense of stability that is not present in the case of, say, an adjustable-rate mortgage. Interest rates for conventional loans tend to be lower than rates for FHA loans yet higher than those of VA loans.
Conforming conventional loans must fall within the limits set by Fannie Mae and Freddie Mac. If the loan surpasses that limit, it becomes a jumbo (nonconforming) loan.
Usually, you’ll be able to borrow more money on a conventional loan than on a FHA loan.
Potential Los Angeles borrowers must complete an official mortgage application (and usually pay an application fee), then supply their lender with the necessary documents to perform an extensive check on their background, credit history, and current credit score.
Conventional mortgages have a fixed rate of interest, which means that the interest rate does not change throughout the life of the loan. This gives Los Angeles homebuyers a sense of stability that is not present in the case of, say, an adjustable-rate mortgage. Interest rates for conventional loans tend to be lower than rates for FHA loans yet higher than those of VA loans.
Conforming conventional loans must fall within the limits set by Fannie Mae and Freddie Mac. If the loan surpasses that limit, it becomes a jumbo (nonconforming) loan.
Usually, you’ll be able to borrow more money on a conventional loan than on a FHA loan.
Potential Los Angeles borrowers must complete an official mortgage application (and usually pay an application fee), then supply their lender with the necessary documents to perform an extensive check on their background, credit history, and current credit score.
Conventional Mortgage Requirements
Documentation Needed to Get a Conventional Mortgage
- Proof of income and assets.
- Employment verification
- A driver’s license/state ID card.
- A valid social security number.
Other Requirements
- Proof of income and assets.
- Employment verification
- A driver’s license/state ID card.
- A valid social security number.
Down Payment
The requirement for a down payment can vary based on your personal circumstances and the kind of loan or property you’re getting. First-time home buyers in Los Angeles have the possibility of acquiring a conventional mortgage with a down payment as low as 3% through financial assistance programs.
- Proof of income and assets.
- Employment verification
- A driver’s license/state ID card.
- A valid social security number.
CalHFA Conventional Loan DPAs
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- CalHFA Conventional DPA Loans and MyHome offer a deferred payment program up to the lesser of 3% of the purchase price or appraised value to assist with down payment and/or closing costs. ZIP Not Allowed.
- CalPLUS Conventional DPA, MyHome, and ZIP provide the down payment assistance of MyHome with the addition of the ZIP program for closing costs.
CalHFA FHA Loan DPAs
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- CalHFA FHA DPA Loans and MyHome offer a deferred payment program up to the lesser of 3% of the purchase price or appraised value to assist with down payment and/or closing costs. ZIP Not Allowed.
- CalHFA FHA DPA Loans provide the down payment assistance of MyHome with the addition of the ZIP program for closing costs.