Conventional financing is what many people consider “typical” financing.
This is the type of financing that usually would require 10% to 20% down.
Conventional financing is often a 30 year fixed loan. This means that the interest rate and payment will be the same for 30 years, and at the end of 30 years, the loan will be completely paid off.
Currently, in Orange County, conventional financing is broken down in two types.
1. Conforming conventional loan – with a conforming loan, the loan amount must be under $417,000
for 2010 on a single unit.
– This usually has one of the lowest interest rates available.
2. Jumbo conventional – a jumbo conventional in Orange County can be as much at $729,750 for one unit.
– A jumbo conventional has a higher interest rate than a conforming conventional.
The conventional loan limits have been increased by Fannie Mae in the past few years in an attempt to make loans more available and help to alleviate the housing crisis that has been effecting the entire country.
A conventional loan is typically “full doc.” This means that the borrower will have to prove his income and his assets in order to qualify for the loan.