Conventional Mortgage Loans Fannie Mae Guidelines


This BLOG On Conventional Mortgage Loans Fannie Mae Guidelines Was UPDATED And PUBLISHED On September 25th, 2020

Conventional Mortgage Loans
Gustan Cho Associates

30 year fixed mortgage rates on Conventional Mortgage Loans are generally higher than FHA mortgage rates. Mortgage Rates on Conventional Mortgage Loans are generally more sensitive to credit scores and loan to value than government loan programs.

  • Conventional mortgage rates have since been dropping the past several weeks
  • We now have special conventional mortgage loan programs that can benefit both purchase and refinance conventional mortgage borrowers

In this article, we will cover and discuss Conventional Mortgage Loans Fannie Mae Guidelines.

Down Payment Requirements On Conventional Mortgage Loans

We offer conventional mortgage loan programs up to 97% loan to value for a primarily residential home. The minimum credit score needed to qualify is 620 FICO.

  • The 620 credit scores are the minimum credit scores required for all occupancy types of conventional mortgage loans

Types Of Conventional Mortgage Loans 

what are Types Of Conventional Mortgage Loans 

  • Purchase borrowers
  • Limited Cash-Out Refinance borrowers
  • Cash-Out Refinance borrowers

Conventional Mortgage Loan Terms

There are multiple terms offered on conventional loans:

  • 10 year fixed rate
  • 15 year fixed rate
  • 20 year fixed rate
  • 25 year fixed rate
  •  30 year fixed rate
  • 15, 30-year fixed for High Balance conventional mortgage loans

Residence Types

Government loans are for owner occupant properties. However, Conventional Loans allow for second and investment properties:

  • Primary residence (owner-occupied) which includes single-family homes, townhomes, and condominiums
  • No condo-hotel units
  • Fannie Mae and/or Freddie Mac does not offer financing on NON-Warrantable Condos and Condotel Financing

Condotel Financing & Non-Warrantable Condominium Loans

Condotel and NON-Warrantable Condo Financing are NOT Conventional Loans. These types of loans are portfolio loans.

  • Condotel units mortgage loans are available on 3/1 ARM, 5/1 ARM, 7/1 ARM portfolio mortgage loan products amortized over 30 years
  • Index for Condotel mortgage loans are based on the one year Cost Maturity Treasuries (1-year treasuries) and the margin is set at 3%
  • The adjustment rate after the initial fixed-rate expires cannot be lower than the start rate
  • Please contact me for more information on Condotel mortgage loans at 262-716-8151 or text us for faster response or email us at
  • Or visit us at

Types Of Properties That Can Be Purchased With Conventional Loans

what are Types Of Properties That Can Be Purchased With Conventional Loans

1-4 unit single-family residential units.

  • FNMA approved condos and PUDs (check)
  • Manufactured housing
  • 2nd / vacation homes
  • Non-Owner occupied – Investment properties

Loan to Value (LTV): (Standard Primary Residence)

  • 97% for Purchase conventional mortgage loan programs
  • 97% for Rate / Term refinance conventional mortgage loan programs
  • 80% for Cash-Out refinance conventional mortgage loan programs

Mortgage Insurance

How Mortgage Insurance

  • All mortgage insurance will be followed by Fannie Mae’s Automated Approval DU findings
  • Standard MI coverage required
  • Lender paid mortgage insurance program available for a slightly higher mortgage rate

Gustan Cho NMLS ID # 873293

Related> Conventional Loans

Related> 3% Down Payment Conventional Loans

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