San Diego, CA (PRWEB) December 02, 2013
LoanLove.com is a borrower advice website that offers information, advice and online tools that can help borrowers to find a home loan that they will love. The website differs from some other loan advice sites, in that the information is provided in a casual, easy to understand and even entertaining way. But, while the website provides info in a clear way that even the newest loan borrowers will be able to understand, even experienced home owners can benefit from it since it is also not lacking in depth or detail. The articles cover a wide range of topics that affect home loan borrowers, and the website also strives to keep their readership updated on any new developments in the real estate or finance world. A recent article from Loan Love helps borrowers to understand some of the more commonly confused loan terms, one of which is high balance conforming loans. This information can be very handy at the moment as recent news of the FHFA’s decision to keep conforming loan limits unchanged means that this term will be popping up everywhere in the media.
As a November 26th report from Mortgage News Daily explains: “Whether because of the uproar from some members of Congress, the Mortgage Bankers Association, National Association of Realtors, and other industry players or not, Edward J. DeMarco, Acting Director of the Federal Housing Finance Agency (FHFA) has left loan limits for Fannie Mae and Freddie Mac unchanged for the coming year. In a press release on Tuesday DeMarco said that the maximum conforming loan limits for mortgages acquired or guaranteed by the two government sponsored enterprises (GSEs) will remain at $417,000 for one-unit properties in most areas of the country.”
Some borrowers may be wondering if this news will affect their loan options. In order to understand how this news will affect them, borrowers will first need to have a clear understanding of what a conforming loan is in the first place. The recently posted Loan Love article explains: “Maneuvering the maze of finances involved in the loan application process is tough enough without someone throwing a vocabulary quiz at you. Unfortunately, the terms tossed your way as you consider financing options for the home of your dreams can start to all sound alike. Worse yet, it is not unusual for the media, websites or even real estate professionals to confuse the issue further by using terms interchangeably, like conventional vs. conforming loans, that aren’t actually synonymous.”
The article goes on to explain: “A mortgage loan that is “conforming” refers to one that is within the conforming loan limits set by Fannie Mae and Freddie Mac, currently at $417,000, while also conforming to the funding criteria of Freddie Mac and Fannie Mae. A nonconforming loan, then, would be a loan that does not meet these requirements. So-called “jumbo” mortgage loans would fall into the category of nonconforming loans.”
The article also says “…a mortgage loan that is not made or insured by the government is known as a conventional loan. That means by definition, a conventional loan may also be conforming, but not all conforming loans are conventional loans. Loans above the lending limits set by Fannie Mae and Freddie Mac are often called jumbo loans. The majority of conventional loans, however, follow the qualifying criteria that would make them conforming.”
Overall, conforming loan limits staying put for the next year is great news, especially for those who need the lower down payment and fees provided with government backed home loans.
For more information on the differences between conventional and conforming loans, please read the full article at LoanLove.com.