30 Year Fixed Rate Loan Program
30 Year Fixed Rate Loan Program
The 30 year fixed rate mortgage is one of the most desirable loan programs available. Borrowers like the low monthly payments and the stability of the 30 year fixed rate over a variable rate. The term of a 30 year fixed rate mortgage is long and consequently you pay more interest over the life of the loan. However, the 30 year fixed rate mortgage is recommended for borrowers who intend to stay in their house for a long period of time. It is indeed the most common and easiest fixed-rate loan to qualify for. Advantages: Low monthly payments. Can be refinanced if the interest rates drop. Monthly payments and interest rate are fixed for 30 years and can't increase. Disadvantages: Higher interest rates than shorter term mortgages. Mortgage payments do not drop if interest rates drop.
Conforming Loans Conforming loans typically refer to loan amounts that conform to government service standards as determined by Fannie Mae & Freddie Mac. These two government agencies, set up in the early 1940's, were established to help people finance new homes. The Conforming loan limit is $417,000 for single family homes. However, not all conforming loans are serviced by these government agencies. Below are the current conforming loan limits for 1-4 unit/condos, primary residences, and second homes: • 1-unit: Up to $417,000 • 2-unit: $533,850 • 3-unit: $645,300 • 4-unit: $801,950