What is a Conventional Loan?
A conventional loan is a mortgage that is not insured or guaranteed by a government agency. Instead, it follows guidelines set by Fannie Mae and Freddie Mac and is backed by private lenders.
These loans are popular among borrowers with strong credit histories and stable income. They are available for a wide range of property types.
In Nebraska, conventional loans are frequently used across Lincoln and Omaha for both purchases and refinances.
Potential Benefits of Conventional Loans
Conventional loans offer versatility across many borrower profiles.
Competitive Interest Rates
Conventional loans often offer competitive rates for borrowers with established credit histories.
Flexible Loan Terms
Choose from various loan terms, including fixe 10-30 year options to fit your financial goals. Ask about Flex-Term.
No Upfront MI with 20% Down
Avoid upfront mortgage insurance costs when you can make a 20% or larger down payment.
Multiple property types allowed
Conventional loans may be used for primary, second, or investment homes.
Who Might Consider a Conventional Loan?
Conventional loans may be a good option for borrowers in certain situations. Consider this loan type if you fit any of the following profiles:
- Borrowers with established credit histories
- Those who can make a larger down payment (though lower options exist)
- Buyers seeking competitive rates without government loan restrictions
- Second home or investment property purchasers
Things to Consider
While Conventional loans offer many advantages, there are factors to keep in mind:
- Borrowers with established credit histories
- Buyers seeking competitive rates without government loan restrictions
- Those who can make a larger down payment (though lower options exist)
- Second home or investment property purchasers
- Eligibility for loan programs depends on your specific financial situation, credit profile, and property details. This information is for educational purposes only and does not constitute a commitment to lend.
Can conventional loans be used for investment properties?
Yes. Conventional loans are commonly used for second homes and investment properties.
How do conventional loans compare to FHA loans?
Conventional loans typically require stronger credit, while FHA loans allow more flexible qualification.
Are conventional loans available in Nebraska?
Yes. Conventional loans are widely available throughout Nebraska, including Lincoln and Omaha.
Do conventional loans have loan limits?
Yes. Conventional loans are subject to conforming loan limits that vary by location.