Conventional Mortgage Loans

If you've found the house of your dreams,
you can get a conventional loan at a fixed or adjustable rate.


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Conventional Mortgage Loans


A conventional mortgage is a home loan that isn’t guaranteed or insured by the federal government and conforms to the loan limits set forth by Freddie Mac and Fannie Mae. You can get a conventional loan at a fixed or adjustable rate.

Conventional loans are offered by private entities such as banks or savings institutions. Because they are not guaranteed by the government if the buyer defaults, they’re a higher risk for lenders.

Conventional loans also require a larger down payment, so those buyers tend to have a more secure financial standing and are less likely to default. The larger down payment also means lower monthly payments. Plus, with the ever-increasing mortgage insurance premiums on FHA loans, payments for conventional loans can be much more manageable in comparison.

 

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Conventional mortgages fall into two categories: “conforming” and “non-conforming” loans.

Conforming loans follow the guidelines set by Fannie Mae and Freddie Mac, two government-controlled companies that provide money for the U.S. housing market. The most well-known rule has to do with the size of the loan. In 2017, home loans for single-family homes in most of the continental U.S. are limited to $417,000. Higher-cost areas, such as Hawaii and Alaska, have higher limits up to $625,500 for single-family homes.

Non-conforming loans, often called jumbo loans, are for borrowers who don’t qualify for a conforming loan because the amount is higher than the conforming limit for the area. Because they don’t conform to the guidelines, jumbo loans are usually harder to sell on the secondary market (when lenders sell their loans to other institutions), making them less attractive to lenders. And the higher amount of money involved also means more risk for the lender.

Other types of non-conforming loans include those made to borrowers with poor credit, high debt or recent bankruptcy, or on homes with a high loan-to-value ratio (usually up to 90% for a conforming loan).




Mortgage Calculators

Mortgage Loan Calculator Use this calculator to determine your monthly payment and amortization schedule.
Mortgage Qualifier Can you buy your dream home? Find out just how much you can afford!
Refinance Breakeven Should you refinance your mortgage? Use this calculator to determine when you will breakeven!
Rent vs. Buy Are you better off buying your home, or should you continue to rent?


Have you found the home of your dreams? Send your questions in the email form below or stop by in person to start the process today.

Types of Mortgages:



FHA Mortgage Loans

Typically an FHA loan is one of the easiest types of mortgage loans to qualify for because it requires a low down payment and you can have less-than-perfect credit.


VA Mortgage Loans

A VA loan is a mortgage loan that’s backed by the Department of Veterans Affairs (VA) for those who have served or are presently serving in the U.S. military.



Re-Finance Your Home

Whether you're looking to lower your interest rate, reduce your monthly payments or interest expense, switch from an adjustable to a fixed rate, consolidate bills, or obtain extra money to pay for expenses, a mortgage refinance could be the solution for you.

Download an Application Here


Traders & Farmers Bank Mortgage Department

Everything You Need Under One Roof

1728 11th Avenue
Haleyville, AL 35565

Phone: 205-486-6206
fax: 205-486-6209

Standard Mortgage Documents Needed to Begin Mortgage Process:
  • Completed Application
  • Copy of Drivers License
  • 2 Years Most Recent Tax Returns with W2's or 1099's
  • 2 Most Recent Pay Stubs
  • 2 Most Recent Bank Statements
TFB Mortgage Company