Please Define conventional financing...

Financing, Hard Money Lenders, Private Money
1

Hi Everyone,

back after a brief hiatus. Would someone be so kind as to explain or define “conventional financing” I understand this is through a bank, but generally speaking, what are the requirements to obtain conventional financing?

Thanks,
CC

2

CC,

Conventional Loan - A conforming loan with no government guarantee; that is, a Fannie Mae or Freddie Mac loan. (See definition of “conforming loan” above.).

Conforming Loan - A loan which has underwriting criteria consistent with (i.e., conforming to) those strict guidelines of Fannie Mae, Freddie Mac, FHA or VA. These are typically the lowest interest rate loans with very good terms

Reminder: There is an “Investing Glossary” under the “Investor Information” Section of the “site Navigation” to the left side of the page!

Keith

3

Thanks, Keith. I’ve been on the sidelines for a few months. I’m mulling the purchase of a 6-plex rehab.

I completely forgot about the dictionary. You’re a peach.

C

4

Generally, you need some kind of downpayment but you can still do a conventional loan at 100% financing by doing a 80/20 loan. One loan for 80% and the other for 20%. This helps you to avoid PMI also.