A conventional loan is a prevalent refinance option among borrowers with good credit and secure finances. Borrowers can receive more accommodating conditions and fewer limitations since the government does not back these loans. Also, borrowers can avoid paying Private Mortgage Insurance (PMI) if they have at least 20 percent equity.
Overall, Conventional Loans Are:
- Simple: Less paperwork, fewer rules, and regulations
- Flexible: More options allows for more customization
- Versatile: Single, multi-family, condominiums, manufactured homes, etc.
There are two types of conventional loans: fixed-rate and adjustable-rate mortgages. For fixed-rate mortgages, the interest rates do not change throughout the duration of the loan. The most common terms are 15- or 30-years. The monthly payments are generally lower since they are spread out over time. Adjustable-rate mortgages feature flexible interest rates with an initial up-front fixed period. After the initial period, the rate can adjust (usually higher) along with monthly payments. Adjustable-rate mortgages are best for borrowers who do not plan on staying in their home long-term.
Questions? Contact us today to learn more. Our specialists can help you to get the refinance process started quickly.
Our "3C" Process:
Complete our pre-approval request
Consider options based on your requirements
Choose the offer that suits your needs best