Conventional Home Mortgage Loan Options In Palmdale
What is a Conventional Mortgage or Loan?
Conventional mortgages loans, or conventional mortgages, are not guaranteed or insured by the United States Federal Government. These loans are typically “conforming,” which means that they are eligible to be sold to Fannie Mae or Freddie Mac, both of which are government-sponsored businesses that purchase mortgages from lenders like us, then sell them to investors or other third parties. However, some conventional loans can be non-conforming, meaning they don’t meet Fannie Mae or Freddie Mac's requirements.
Every conventional loan requires different approval criteria, which is also true of applicants themselves. All lenders have guidelines for their borrowers, so reach out today to see if you’re qualified for a conventional mortgage. It’s important to keep in mind that conventional loans tend to have stricter eligibility requirements compared to loans insured by the government (FHA, USDA, VA, etc.), so expect to need a credit score of at least 620 and a DTI ratio of 50% or less in most cases.
Frequently Asked Questions About Conventional Loans
Conventional Loan VS. FHA Loan
There’s a common misconception that conventional mortgages are only for established home buyers, and FHA loans are only designated for first-time homebuyers. But, that’s not necessarily the case. Both FHA and conventional loans are available to first-time homebuyers, but the requirements are different. Major differences to keep in mind are:
| FHA | Conventional |
|---|---|
| Insured by Federal Housing Administration | Not insured by a Government entity |
| Require a minimum down payment of 3.5% for borrowers with credit scores of 580 or higher | May allow as low as a 3% down payment, but only for applicants with credit scores in the high 600s+, with significant income and savings |
| Debt-to-income (DTI) ratio must be 50% or less to qualify | DTIs of 43% or less in most approval cases |
| Mortgage insurance is required regardless of down payment amount | Borrowers are required to pay for mortgage insurance if their down payment is less than 20% |
How to Get a Conventional Home Loan in Palmdale
Applying for a conventional mortgage loan in California is straightforward. Get in touch with our team of industry-leading loan officers to get more information about what we require in order to apply for — and get approved for — a conventional home loan. We will guide you through each step of the process and answer all of your questions along the way.
How to qualify for a Conventional Mortgage in Palmdale?
You can qualify for a conventional loan if you meet most of the following criteria:
- At least a 620 credit score and proven credit history — on-time payments, paying off balances, etc.
- At least a 3% down payment for first-time homebuyers, or a minimum of 10% down if buying a second home
- DTI ratio of 50% or less to prove that you can afford mortgage payments
- If the home is a condominium or other property that isn’t a single-family home, you may want to consider a 15% or greater down payment
- If putting less than 20% down towards your loan, you have to pay private mortgage insurance
Is down payment assistance available for Conventional Mortgages?
Yes, down payment assistance may be available to you on a conventional loan. Down payment assistance helps you cover the cost of your first home’s down payment. It can be available to eligible borrowers (you have to meet specific requirements), so reach out to us to see if you qualify for down payment assistance.
How do I get pre-approved for a Conventional Loan?
To get pre-approved for a conventional loan in Antelope Valley, CA 93551 you’ll need to prepare documentation and have information on-hand about your financial situation. Items you may need:
- Proof of Income
- Proof of Assets
- Good Credit Score/History
- Proof of Employment
- Miscellaneous (driver’s license, etc.)
What are the options to refinance a Conventional Home Loan?
Conventional refinancing basically replaces your existing home loan with a brand new conventional mortgage. It’s a flexible form of financing and often permits borrowers to secure a lower interest rate, cash-out equity, shortened loan terms, and more.
Reach out to California Mortgage Girl and see if a purchase/conventional home loan is right for you.
Get a Palmdale Conventional Mortgage rate quote:
Get the mortgage you deserve today.
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My 25+ years of lending experience has put me in touch with the first time homebuyer to the most complicated self-employed entrepreneur with multiple properties and complex tax returns. My goal is always the same – provide useful and reliable information so the Customer can make an informed decision before entering into a real estate transaction.
This is not a commitment to lend or extend credit. Programs, rates, terms and conditions are subject to change without notice. Terms and conditions apply. Consult your accountant about tax deductions.
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