Conventional Loan

About Conventional 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 3% down payment. Rebecca Foote Mortgage Team in Carlisle, Pennsylvania 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 an investment property.

Features of Conventional Loans

• Up to 97% financing
• Seller may pay 3-9% of the purchase price toward closing costs and prepaids, depending on the buyer’s down payment amount
• Mortgage insurance required for down payments less than 20% (varies by down payment amount)
• Elimination of Mortgage Insurance is possible with less than 20% down payment, for an upfront fee or a higher interest rate (both options vary by down payment amount and credit score)
• Minimum credit score of 620
• Gift funds are allowed…must be from a relative
• Entire down payment may come from gift funds
• No income limitations

Consideration Points for Borrowers

• Property not required to meet HUD guidelines (HUD appraisal NOT required)
• Maximum loan amount is $726,200*
• Non-occupant co-borrowers allowed
• No specific inspection requirements, unless appraiser notes deficiencies
• Warrantable condos allowed
• Portfolio loan options MAY be available case-by-case for loans a little outside-of-the-box

Conventional Loan Qualifying

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.

If you have any questions about Conventional Loans, don’t hesitate to reach our to my team at (717) 609-4044. We are happy to answer your questions and would love to work with you!