Conforming loans are loans that are backed by Fannie Mae and Freddie Mac. These loans allow you to purchase a property for your primary residence, second home, or investment property. The benefits are very low rates historically, as well as set guidelines. Most conforming loans are either a 30 year fixed rate loan or a 15 year fixed rate loan, but you can also get a 10 year fixed rate, 20 year fixed rate, or 25 year fixed rate. A conforming 30 year fixed rate is the most common loan typically originated, while the 15 year fixed rate historically offer the best rates.
Additionally, conforming loans allow less than 20% down on primary, secondary, and investment properties.
Here are the minimum down payments for conforming loans as of 2022:
Primary home – 3%
Secondary home- 10%
Investment home- 15%
Regarding the maximum loan amounts, Fannie Mae / Freddie Mac set the conforming loan limits each year. While Park Place Finance offers loans above these thresholds, loans above FNMA loan limits are considered jumbo loans. Click on our jumbo loan link for more details on that.
Based on the 2022 guidelines here are the conforming loan limits for Texas, based on the # of units in the property:
1 Unit – $647,200
2 Unit – $828,700
3 Unit – $1,001,650
4 Unit – $1,244,850
For loans in certain California counties, as well as other high cost living areas, the conforming loan limits are higher:
1 Unit – $970,800
2 Unit – $1,243,050
3 Unit – $1,502,475
4 Unit – $1,867,275
For more information on which counties in the US are in higher cost areas and qualify for these higher loan limits on a conventional loan, give us a call.