What is a Conventional Mortgage?
When you are ready to buy a home in St. Louis, exploring your loan options is the first step. A conventional mortgage is a home loan that is not backed by a government agency like the FHA or VA. Instead, these loans follow guidelines set by Fannie Mae and Freddie Mac. At Better Rate Mortgage, we specialize in helping homebuyers secure a conventional fixed-rate mortgage that fits their long-term financial goals.
With a fixed-rate loan, your interest rate and monthly principal and interest payments remain the same for the entire life of the loan. This provides incredible stability, making it easier to budget. If you are comparing a conventional loan to an FHA purchase loan, or if you simply want to explore a 30-year fixed-rate mortgage, our team is here to guide you. We are also experts at providing second opinions on conventional mortgages, ensuring you get the absolute best terms possible.
Conforming vs. Non-Conforming Conventional Loans
When discussing a conventional mortgage, it is essential to understand the difference between conforming and non-conforming loans. These terms refer to whether the loan meets specific funding criteria.
- Conforming Loans: These mortgages fall within maximum loan limits set annually by the Federal Housing Finance Agency (FHFA). Because they conform to these guidelines, lenders can sell them on the secondary market. They typically offer highly competitive interest rates.
- Non-Conforming Loans: Loans that exceed these FHFA limits are considered non-conforming. The most common type is a jumbo mortgage. Because they cannot be sold to Fannie Mae or Freddie Mac, they often carry stricter credit requirements and slightly different rate structures.
Whether you need a standard conforming loan for a starter home or a non-conforming loan for a luxury property in St. Louis, Better Rate Mortgage has the local expertise to make the process smooth and hassle-free.
| Feature | Conforming Conventional Mortgage | Non-Conforming (Jumbo) Mortgage |
|---|---|---|
| Loan Limits | Must be at or below FHFA county limits | Exceeds FHFA limits |
| Credit Score Requirement | Typically 620 or higher | Usually requires a higher score (often 700+) |
| Down Payment | As low as 3% for first-time buyers | Typically 10% to 20% required |
| Interest Rates | Highly competitive and standardized | Can vary depending on the lender |
Why Choose Better Rate Mortgage for Your Home Loan
Finding the right home is only half the battle. You need a trusted St. Louis mortgage lender to ensure your financing crosses the finish line smoothly. At Better Rate Mortgage, a better rate is just the beginning. Our dedicated team, led by Sean Zalmanoff, provides a highly personalized experience from preapproval to closing.
Here is why local homebuyers trust us:
- The $5,000 Guarantee: We back your preapproved offer to sellers with a $5,000 guarantee. If financing falls through, we pay them $5,000. This sweetens your offer and reassures sellers that your financing is rock solid.
- Expert Second Opinions: Already have a quote? We are experts at providing second opinions on conventional mortgages. Let us review your current offer to see if we can save you money.
- Proven Track Record: With over 400 five-star Google reviews, our clients consistently praise our fast, comfortable, and transparent closing process.
We do the heavy lifting so you can focus on packing your boxes and planning your future.
Q1: What is the minimum down payment for a conventional mortgage?
For many first-time homebuyers, a conventional mortgage requires a down payment as low as 3 percent. Repeat buyers typically need at least 5 percent down.
Q2: Do I have to pay mortgage insurance on a conventional loan?
Private mortgage insurance (PMI) is usually required if your down payment is less than 20 percent. However, unlike some government loans, you can request to cancel PMI once you reach 20 percent equity in your home.
Q3: Can I use a conventional mortgage for an investment property?
Yes, a conventional fixed-rate mortgage can be used to finance primary residences, vacation homes, and investment properties.
Q4: How does a conventional loan compare to an FHA loan?
While FHA loans are backed by the government and may have more flexible credit requirements, conventional loans often offer lower costs over time for borrowers with good credit. We can help you compare both to see which fits your needs.
Q5: How can I get a second opinion on my mortgage rate?
Simply reach out to Sean Zalmanoff and the team at Better Rate Mortgage. We will review your current loan estimate and provide an honest, expert second opinion on your conventional mortgage options.
Ready to Buy Your Dream Home?
Get preapproved today or call us for a free second opinion on your conventional mortgage.
Contact Sean Zalmanoff at (314) 361-9979 or Sean@betterratemortgage.com
