Conventional VS Conforming Home Loans Explained In A New Loan Love Article

Share Article’s new guide helps new home loan borrowers understand the terms used in discussing different home loans. is a borrower advice website that provides detailed insights into the mortgage industry in a fun and entertaining way. The team at is devoted to help empower both first time and experienced homeowners with valuable resources, first-class knowledge and connections to top-rated industry professionals and has the mission of helping consumers and borrowers to obtain the latest information on mortgage lending trends, the real estate market and the U.S. financial landscape in order to help them obtain a home loan that they will love. The loan advice website excels at providing readers and loan borrowers with essential advice when working with mortgage loans and refinancing through their many articles and guide videos. In a recent article, titled “Coming to Terms: Understand Conventional vs. Conforming Loan Types”, the website explains the different terminology used when discussing mortgage loans.

In this article Loan Love 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.”

Previously, Loan Love posted an article covering the lingo surrounding interest rates; this new article follows much in the same vein. In this new guide, new loan borrowers will be able to learn about these terms and even experienced home buyers can get a refresher course that will help them to better understand exactly what is going on when they watch or read home loan news or speak with mortgage professionals. Loan Love says: “If you read our column on understanding the lingo surrounding interest rates, you have probably been happily anticipating the next loan lingo lesson. Even if you haven’t, here’s a primer to help you understand the difference between some of the more common mortgage loan terms as you identify your best options for home financing.”

The article then goes on to briefly define some of the most commonly misunderstood or confused mortgage terms, such as:

  •     Fannie Mae
  •     Freddie Mac
  •     VA Loan
  •     FHA Loan
  •     Conforming Loan
  •     Conventional Loan

The last two terms, conforming and conventional, are arguably the most mixed-up when it comes to mortgage-speak. Loan Love explains that conforming refers to loans that conform to the loan limits set by Freddie Mac and Fannie Mae, while conventional refers to loans that are not made or insured by the government. So which option between these two is the best? Loan Love explains:

“If you have an excellent credit history and are able to make a larger down payment, anywhere from 5 to 20 percent, choosing a conventional loan will usually snag you an attractive interest rate, while allowing you to avoid all the red tape. A higher down payment also means your home equity will build more quickly.”

However, a good interest rate does not necessarily mean the best deal. In order to get the whole picture, borrowers must also consider the other fees involved. Loan Love says: “Despite the advantages of a conventional loan, however, you may need to show up at closing with a sizable amount of change, depending on your credit score and other factors. Origination fees, mortgage insurance, points, down payments and appraisal fees can quickly add up, so pay close attention to the details of your loan and not just the interest rate alone to avoid any surprises at closing.”

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Kevin Blue
Loan Love
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