Fall Home Maintenance
St. Louis, MO – October 28th, 2022 – As we approach[...]
Conventional Loan Program
St. Louis, MO – January 17th, 2023 – As the new year begins, we hope to better educate our local communities with further information about the loan programs we offer, coming from our own experts – loan officers! Purchasing a new home can be a strenuous process when you don’t know much about the loan program or details surrounding the transaction. Our loan officers are here to walk with you through the mortgage process from preapproval to closing and answer any questions you have along the way.
Check out our conventional loan program Q&A with Vice President, Ben King:
Q: What is a conventional loan?
A: It is any mortgage that is not insured or guaranteed by the Government. Can be as little as 3% down for first time buyers.
Q: What type of home can a borrower purchase with a conventional loan?
A: Single-family homes, condominiums, townhomes, multi-family units as well as manufactured homes as long as it meets the necessary criteria to be considered a real property.
Q: Is mortgage insurance required with a conventional loan?
A: If you put down less than 20% then mortgage insurance is required. Borrowers have options to pay monthly mortgage insurance with their monthly payments or there are options to buy out mortgage insurance at closing, so you don’t have any monthly mortgage insurance payments ever.
Q: What is the maximum loan amount offered for conventional loans?
A: Conventional loans are either considered Conforming or Non-Conforming loans. A conforming loan is one which has a maximum loan amount for 2023 of $726,200 and can have as little as 3% down payment. If the loan amount is over $726,200 then it is a non-Conforming loan or commonly called a Jumbo loan. Maximum loan amount is $3,000,000 and will typically require at least 10% down. Jumbo loans typically have more stringent guidelines in order to qualify than a Conforming loan.
Q: Are there any benefits to a conventional loan that make it stand apart from other loan programs?
A: Yes, Conventional loans do not have upfront funding fees like Government loan products (FHA, USDA, and VA) have. Also with a conventional loan, mortgage insurance can be much cheaper than government loan products with those who have good to excellent credit. Another benefit is monthly mortgage insurance typically drops off once the original loan to value reaches 80% where with FHA (when only 3.5% down payment) and USDA loans, monthly mortgage insurance is for the life of the loan.
If you’re interested in purchasing your first home, it may be a good idea to sit down with a knowledgeable loan officer before you are ready to buy. Gershman Mortgage staffs only the best and brightest loan officers in the game and they will help you make the best decision for you and your family. Especially when it comes to down payments, they can help you determine a price range that fits your budget and how much you’ll need.
When you are ready, contact a Gershman Mortgage Loan Officer to start your journey home today.
About Gershman: Communities, families, and homes are at the heart of what we do at Gershman Mortgage. Our founding principles are based on the core values of honesty, integrity, the entrepreneurial spirit, and putting our customers first. We are passionate and committed to customer service and strive to ensure that we exceed the expectations of our customers. We are a customer-centric company devoted to creating and maintaining long-lasting relationships.
NMLS #138063 16253 Swingley Ridge Road Suite 400 Chesterfield, MO 63017 (800) 457-2357 Equal Housing Lender.