The recent crisis in the mortgage lending industry has made many people rethink the benefit of subprime mortgages, particularly adjustable rate mortgages. The result is more people returning to the conventional mortgage loan. A conventional home mortgage is a fixed rate, 30 year mortgage that is not secured by the federal government. This is the typical fixed rate mortgage that is also known as a conforming loan.

Conventional mortgages often require larger down payments, such as 10 or 20 percent of the total sale price of the home. The lower down payment amount results in a more favorable loan to value ratio, which is one of the factors lenders consider in offering mortgages. The requirements for income and the borrower’s credit are a bit stricter than other types of mortgages, but the conventional mortgage rates are generally lower than other loans.

Perhaps the biggest benefit of the conventional mortgage loan is the favorable interest rate combined with a fixed payment. It is easier to plan for the future when you know your mortgage payment will remain steady. This also helps prevent many of the problems seen recently in the subprime mortgage market, since the payments will not get substantially higher from year to year.

Lenders have specific requirements to qualify for a conventional mortgage loan. The exact requirements may vary from lender to lender. This is where working with an experienced mortgage professional is helpful. We can help you find the best possible terms and conventional mortgage rates for your situation. Our team is dedicated to personal service and will work to help you get the best possible loan for your home purchase or refinance.