Conventional Loans in Jeffersonville, IN
Indiana, Kentucky & Florida’s #1 Source For Your Mortgage Needs
A conventional loan is a mortgage that is not insured by a government agency, which makes these loans a bit more flexible, than an FHA, USDA, or VA loan.
Typically the loan has both a fixed rate and fixed length (number of years).
Conventional loan rates are based on many factors, which includes higher credit scores. Higher credit scores typical mean that buyers have a more solid track record of paying back debt, so they are rewarded with lower interest rates.
Conventional loan down payments start as low as 3% … most people assume that 20% down payment is required, which isn’t the case.
As a conventional loan first time home buyer you can put down as little as a 3% of the asking price of the home. For all others 5% down payment is need for a conventional loan. Since you are putting less than 20% down there is mortgage insurance (PMI) that will be added to your monthly mortgage payment. This will be paid until you reach that 20% down threshold.
For example: You purchase a $250,000 with a $7,500 down payment. PMI will be paid until you have paid in the 20% ($50,000). Once that has happened the PMI will be automatically removed from your mortgage. If you have a bit of extra money lying around, then it would be a great idea to pay a bit extra on your principal each month.
If you don’t qualify for a conventional loan … don’t worry! Our team can run a comparison of conventional loan vs FHA to determine the best loan for you and your family.
Second homes can be purchased via a conventional loan, however a higher down payment might be required.
If you’ve gone through a Chapter 13 bankruptcy, Chapter 7 bankruptcy, foreclosure, or short sale in the past home ownership in still a possibility. It just might take a few years to get your credit in shape. Give us a call and we can help you navigate the steps to your new home.
- Chapter 13 = 2 years
- Chapter 7 = 4 years
- Foreclosure = 7 years
- Short sale = 4 years
Click here to view a loan comparison sheet.
Is a conventional loan the right loan for you!?! Give us a call at 812-941-0926 and we can discuss with you.
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