Conforming LoansConforming loans are conventional loans that meet bank-funding criteria set by Fannie Mae and Freddie Mac. Both of these stock-holding companies buy mortgage loans from lending institutions and secure them for resale to the investment community. Every year, from October to October, Fannie Mae and Freddie Mac establish limits on what constitutes a conforming loan based on the changes in the median home price. Anything that exceeds the lending limit set forth is considered a Jumbo Loan. Buying back mortgage loans allow these agencies to provide a continuous flow of affordable funding to banks that reinvest their money back into more mortgage loans. Fannie Mae and Freddie Mac only buy loans that are conforming, to repackage into the secondary market – effectively decreasing the demand for non-conforming loans. For more information about Conforming Loans and limits, contact our Home Loan Specialists at (866) 772-3802 or use the tools on this site.
Conventional Loans AustinConventional loans are mortgage loans offered by non-government sponsored lenders. Any loan that is not guaranteed or insured by the Federal government is a conventional loan. These loan types include:Fixed Rate Loans; Balloon Mortgages and Pledge Asset Loans; Jumbo / Construction Loans; Reverse Mortgage. Conventional loans are a type of home mortgage in which the underlying terms and conditions meet the funding criteria of Fannie Mae and Freddie Mac. They were the very first traditional mortgage loans offered by local banks and lenders. About 35-50% of mortgages, depending on market conditions and consumer trends, are conventional mortgages. In other words, Fannie Mae and Freddie Mac guarantee or purchase 35-50% of all mortgages. Conventional mortgages may be fixed-rate or adjustable rate mortgages. For additional information about conventional loans, contact our Home Loan Specialists at (866) 772-3802 or use any of the tools on this website.
Construction-to-Permanent Loans AustinAre you looking at building a home? If the idea of building your own home excites you, the first thing you need to do is familiarize yourself with the types of construction loans available in today’s market. Learning the basics of a construction loan will prepare you when it’s time to decide to build your own home. A Conventional Construction-to-Permanent mortgage is mainly used to finance the building of the borrower’s home and permanent mortgage all into one individual transaction with a single closing. The borrower is going to be approved for a standard Construction-to-Permanent mortgage if the borrower is already qualified for a long-term permanent conventional mortgage. Upon conclusion of construction, the borrower is going to be expected to convert from the interim construction loan right into a permanent standard fixed-rate loan. For more information about the conventional-conforming one-time close construction loan, with a 95% loan-to-value (LTV), call us at (866) 772-3802.
Texas Cash Out RefinanceWhen someone talks about cash-out refinance loans, they are referring to a home mortgage where the borrower receives cash back at closing after paying off the first mortgage, any liens, and any closing costs. In Texas, the maximum loan amount of any owner-occupied cash-out refi loan cannot exceed 80% of the property value or loan-to-value (LTV). People take advantage of cash out loans for several reasons like consolidating their debt, home improvements, funding a college education, taking a vacation, or even just to have extra cash on hand. When a homeowner refinances their existing mortgage and gets cash back at closing, the mortgage will be considered a Cash Out Refi Loan. The old rule on a cash-out refi, “once a cash-out, always a cash-out” is just that, an old rule. It was always treated as a cash out for the rest of the loan term. For additional information, contact our Home Loan Specialist at (866) 772-3802