Overview

What Is A Conventional Loan?

A conventional loan by definition is simply a mortgage that is not guaranteed by any government agency including the Federal Housing Administration (FHA) and the U.S. Department of Veterans Affairs (VA). This includes loans from banks, credit unions, or mortgage companies. Mortgage loans guaranteed by government agencies are often geared towards the borrower with lower income and credit scores. On the other hand, conventional loans have become a popular choice amongst borrowers with stronger credit and generally higher income. Davis Mortgage Ltd. offers a variety of conventional loan options throughout Corrales, Rio Rancho, Albuquerque and the surrounding Albuquerque Metro communities.

No single loan is ideal for every borrower which is why there are so many conventional loan options available. Let’s take a look at some of these options available for conventional mortgages.

30 Year Fixed Rate

30 Year Fixed Rate

With a fixed rate mortgage, the interest rate does not change for the term of the loan, so the monthly payment is always the same. Typically, the shorter the loan period, the more attractive the interest rate will be.

Payments on fixed-rate fully amortizing loans are calculated so that the loan is paid in full at the end of the term. In the early amortization period of the mortgage, a large percentage of the monthly payment pays the interest on the loan. As the mortgage is paid down, more of the monthly payment is applied toward the principal.

A 30 year fixed rate mortgage is the most popular type of loan when borrowers are able to lock into a low rate.

Benefits:

  • Lower monthly payments than a 15 year fixed rate mortgage
  • Interest rate does not go up if interest rates go up
  • Payment does not go up, it stays the same for 30 years

Drawbacks:

  • Higher interest rate than a 15 year fixed rate mortgage
  • Interest rate stays the same even if interest rates go down
15 Year Fixed Rate

15 Year Fixed Rate

A 15 year fixed rate mortgage allows you to pay off your loan quicker and lock into an attractive lower interest rate.

Benefits:

  • Lower interest rate
  • Build equity faster
  • If interest rates go up, yours is fixed

Drawbacks:

  • Higher monthly payment stays the same if interest rates go down
  • Interest rate stays the same even if interest rates go down
Jumbo Loans

Jumbo Loans

A Jumbo Loan is a mortgage option for loan amounts over the federally mandated conventional limit. Currently, the Jumbo loan limit is $417,000. However, Congress has recently approved changes that may get you a lower rate on some jumbo loans.

Jumbo loans are much more flexible than most people think. Here is a how a Jumbo loan can help you afford your home in that high cost area:

For a Jumbo Loan you don’t always need a down payment of 20 %. Based on your home, the market, and your finances, you can refinance your jumbo loan with less than 80% equity. Or, buy a home in a competitive market with as little as 10% down.

Did you know that FHA loans are available as a jumbo? Get up to 97% financing on your home with the new, higher FHA loan limits!

Jumbo loans can either be fixed-rate or have a mortgage rate that adjusts after a fixed period. An adjustable-rate mortgage can get you a smaller monthly payment. A fixed-rate mortgage can give you secure, fixed payments year after year.

Charles Davis

NMLS: 299652

Overview

What Is A Conventional Loan?

A conventional loan by definition is simply a mortgage that is not guaranteed by any government agency including the Federal Housing Administration (FHA) and the U.S. Department of Veterans Affairs (VA). This includes loans from banks, credit unions, or mortgage companies. Mortgage loans guaranteed by government agencies are often geared towards the borrower with lower income and credit scores. On the other hand, conventional loans have become a popular choice amongst borrowers with stronger credit and generally higher income. Davis Mortgage Ltd. offers a variety of conventional loan options throughout Corrales, Rio Rancho, Albuquerque and the surrounding Albuquerque Metro communities.

No single loan is ideal for every borrower which is why there are so many conventional loan options available. Let’s take a look at some of these options available for conventional mortgages.

30 Year Fixed Rate

30 Year Fixed Rate

With a fixed rate mortgage, the interest rate does not change for the term of the loan, so the monthly payment is always the same. Typically, the shorter the loan period, the more attractive the interest rate will be.

Payments on fixed-rate fully amortizing loans are calculated so that the loan is paid in full at the end of the term. In the early amortization period of the mortgage, a large percentage of the monthly payment pays the interest on the loan. As the mortgage is paid down, more of the monthly payment is applied toward the principal.

A 30 year fixed rate mortgage is the most popular type of loan when borrowers are able to lock into a low rate.

Benefits:

  • Lower monthly payments than a 15 year fixed rate mortgage
  • Interest rate does not go up if interest rates go up
  • Payment does not go up, it stays the same for 30 years

Drawbacks:

  • Higher interest rate than a 15 year fixed rate mortgage
  • Interest rate stays the same even if interest rates go down
15 Year Fixed Rate

15 Year Fixed Rate

A 15 year fixed rate mortgage allows you to pay off your loan quicker and lock into an attractive lower interest rate.

Benefits:

  • Lower interest rate
  • Build equity faster
  • If interest rates go up, yours is fixed

Drawbacks:

  • Higher monthly payment stays the same if interest rates go down
  • Interest rate stays the same even if interest rates go down
Jumbo Loans

Jumbo Loans

A Jumbo Loan is a mortgage option for loan amounts over the federally mandated conventional limit. Currently, the Jumbo loan limit is $417,000. However, Congress has recently approved changes that may get you a lower rate on some jumbo loans.

Jumbo loans are much more flexible than most people think. Here is a how a Jumbo loan can help you afford your home in that high cost area:

For a Jumbo Loan you don’t always need a down payment of 20 %. Based on your home, the market, and your finances, you can refinance your jumbo loan with less than 80% equity. Or, buy a home in a competitive market with as little as 10% down.

Did you know that FHA loans are available as a jumbo? Get up to 97% financing on your home with the new, higher FHA loan limits!

Jumbo loans can either be fixed-rate or have a mortgage rate that adjusts after a fixed period. An adjustable-rate mortgage can get you a smaller monthly payment. A fixed-rate mortgage can give you secure, fixed payments year after year.

Charles Davis

NMLS: 299652

Testimonials

  • I recently worked with Charles at Vision Mortgage to purchase my first home. Charles was knowledgeable and worked with me to ensure that I got the best loan possible. He was very interactive and was always available to answer any questions that I had. I would definitely work with Charles again!

    Ranae Linton
  • I've worked with Charles on multiple occasions over the years for financing; both purchases and refinancing. His experience and integrity are unparalleled. I was particularly impressed with his breadth of knowledge of what's become a very arcane loan underwriting environment and his responsive, straightforward feedback about potential challenges if any when contemplating a transaction. His relationship and rapport with the lenders, title company and realtors helped ensure smooth transactions and made the process quite simple. The title company and realtors seemed to sigh relief when they learned he was our lender. I think that says it all. He's got my unequivocal recommendation; a true professional full of integrity and he's a pleasure to work with.

    Kevin Bassalleck
  • My husband and I have gone to Charles Davis twice now. Charles is wonderful to work with. He made our first home purchase seamless, answered any questions we had without hesitation and worked so hard for us. He was knowledgeable about our VA home loan and wanted to get us the best deal possible. We went to him for our refinance and it was again a wonderful experience. I recommend Charles to all my friends and family!

    Joile Rodriguez
  • I recently purchased my first home through Charlie and he was fantastic! You hear horror stories of the whole home buying experience but didn’t have one iota of that whatsoever. I used my VA home loan for this purchase and Charlie was extremely helpful and knowledgeable about the VA procedures and was continually updating us with information about every step of the process. I’ve been thinking about investment properties recently and will not hesitate to use Vision for all my future ventures and needs. I’ve already referred two family members to them and they’ve been treated with the same courtesy and professionalism I experienced!

    Angelo Baca
  • I worked with Charles to purchase my home in 2014 and again to refinance this year. On both occasions, I was impressed with their professionalism and knowledge. Every step in the process was explained and my (numerous) questions were answered promptly, patiently, and accurately. I would recommend Charles to anyone, but especially to Veterans looking for someone with specialized knowledge of VA loans and the refinance options available with these loans.

    Kymberleigh Dougherty
  • I recently worked with Charles to purchase my first home. Charles was knowledgeable and worked with me to ensure that I got the best loan possible. He was very interactive and was always available to answer any questions that I had. I would definitely work with Charles again.

    Rane Linton
  • We worked with Charles to buy our home and when we refinanced. He was always very patient and professional. He responded very quickly to any questions we had and he knew about all the VA options for buying/refinancing. I would recommend Charles to anyone

    Evan Lundberg
  • Charles is very knowledgeable, and great to work with. I have used them twice now, and will definitely use them again in the future. They are the best in the biz.

    Dave Auge
  • Charles Davis was unbelievably patient, thorough, and honest in leading us through the mortgage process. They are extremely knowledgeable, professional and very enjoyable to work with. I highly recommend them and have referred many family members and friends.

    Brandon Sehlmeyer
  • Over the past 15 Years, I’ve used Charles Davis for all my home purchases and have been extremely pleased. Charlie’s service cannot be beat, period! Last time I was sitting at the closing table the title agent commented on my interest rate and how low it was comparably. I recommend everyone to Davis Mortgage Ltd.... Charles just helped my 84-Year-old grandmother into a new condo and she was very impressed... not too common for her!

    John Denson
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