Okay, this may be a very DRY blog, but it contains basic conventional loan guidelines that can be useful when starting to look at this loan option for a purchase or refinance.
Conventional:
Maximum Loan Amount: 417K
Credit score minimum: 620
Credit score minimum to get best rates: 680
Maximum Loan to value on a purchase or a no cash-out refinance is 95%. Except in areas that are considered declining markets(the LTV in these areas will be 90% for purchases or refinances).
Maximum Loan to value for a cash-out refinance is 90%, however the cash-out option in declining market areas are starting to disappear if the LTV is over 80%, because mortgage insurance companies will not cover these types of transactions.
Employment: 24 months in the same line of work(exceptions are made)
Full Income Documentation: Most often 2 years W-2's(if you are self employed 2 years 1040's, look at line 37 of these forms and add up both years. Divide by 24 and this will give you a rough estimate of the income that will be used to qualify.)
Stated Documentation: is not addressed in this article due to ever changing guidelines and availability.
Common Property types: Single Family Homes(Doublewide homes will find the best financing with FHA or VA), 2-4 unit homes & condominiums.
Gift Funds:
Generally, when the LTV is 80.00% or less, the entire down payment may be a gift.When loans are greater than 80.00% LTV, borrowers must use their own personal assets for the minimum cash down payment of 5%. (Check out FHA for full down payment assistance up to 97% LTV)
All basic guidelines listed here are not always set in stone and can vary with the borrowers situation. Also not all guidelines are listed. This information is meant to give a solid foundation of basic conventional loan guidelines.
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