OUR CURRENT RATES ARE TOO LOW TO POST ONLINE. CALL 877-451-3100 FOR A QUOTE.
What is a conforming loanAlso called a conventional loan, a conforming loan is a mortgage of under $417,000 that conforms to the guidelines set up by Fannie Mae and Freddie Mac.? Basically, it’s a home loan or a home mortgage. But we are going to do a better job of explaining the term “conforming loan.”
In order to explain it better, the first term you’ll need to understand is “government sponsored enterprise” (GSE). A GSE is a financial service corporation created by the U.S. Congress. GSEs act as financial intermediaries to assist lenders and borrowers in housing and agriculture and they help the economy by enhancing the flow of credit to targeted sectors of the U.S. population.
From 1938 until 1968, Fannie Mae – the Federal National Mortgage Association – was a GSE. In 1968, it was converted into a publicly traded company. In 1970, Fannie Mae was authorized by the US Government to purchase residential mortgage loans. Fannie Mae worked with Freddie Mac (the Federal Home Loan Mortgage Corporation) to develop uniform mortgage documents and national standards for what would one day become known as conforming loans. As such, these two organizations – Fannie Mae and Freddie Mac – collectively assist Americans in gaining access to home financing with lower cost loans. The guidelines established by Fannie Mae and Freddie Mac – and announced yearly – determine the maximum amount that can be borrowed, the borrower’s income and credit requirements, the minimum down payment, and which properties may be suitable for their loan programs.
The terms and conditions on conforming loans offered by Homerica Mortgage Corporation through its third-party providers must follow the guidelines set forth by Fannie Mae and Freddie Mac. So what are conforming loans? They’re mortgages that conforms to GSE guidelines. (Any mortgage that does not meet the GSE guidelines is a non-conforming loan. When a loan does not meet the GSE guidelines because the amount exceeds the guideline limits, it’s known as a jumbo loan. Click here to learn more about jumbo loans.)
Apply now or call us today at 877-451-3100.
See below for our current interest rates on conforming loans.
| Maximum Original Principal Balance for Loans Closed in 2011* | |||
| Units | General | Permanent High Cost Limits | Temporary High Cost Limits* |
| 1 | $417,000 | $625,500 | $729,950 |
| 2 | $533,850 | $800,775 | $934,200 |
| 3 | $645,300 | $967,950 | $1,129,250 |
| 4 | $801,950 | $1,202,925 | $1,403,400 |
| * The Temporary High Cost Limits expire on October 1, 2011. | |||
| All loans must be closed by September 30, 2011 | |||
