Posted 4 years, 7 months ago

When it comes time to obtain a new home mortgage, chances are that your new loan will either be a conventional or government loan. 

Simply put, mortgages that are insured by the FHA and the VA are government loans.  Most other mortgages are considered to be conventional, or jumbo loans.

FHA loans are administered by the Federal Housing Administration (FHA), part of the U.S. Dept. of Housing and Urban Development (HUD).  FHA administers mortgage loan programs with lower down payment requirements that are easier to qualify for than conventional loans.  FHA loans can't exceed the statutory limit.  The loans are made by private lenders and insured by FHA.  FHA loans are attractive to first-time home buyers, lower-income borrowers, and those with limited down payments. 

VA loans are also made by private lenders, but are guaranteed by the U.S. Dept. of Veterans Affairs (VA).  This guarantee allows veterans and service personnel to obtain a home loan with favorable terms and usually without a down payment.  It's easier to qualify for a VA loan than a conventional one, but lenders generally limit the maximum amount.  The VA determines your eligibility, but you still apply to private lending institutions. 

Conventional loans are either conforming or non-conforming.  Conforming mortgages typically offer a lower rate than non-conforming mortgages, but must adhere to certain maximum limits and guidelines.  Non-conforming, jumbo mortgages are for amounts above the conforming loan limits.  Conforming loan amount limits vary by county so be sure to check with us to determine if your loan amount falls within your county’s conforming limit. 

If you'd like more information about any of these loans for your home purchase or refinance, please call us today.  We're happy to put together the perfect solution for your special situation.

-The Kavanewsky Team