Conventional loans are the most common home loan type. They do not involve government insurance or guaranties and are normally underwritten to private industry standards that have proven to be safe and sound historically. There are two primary sub types: Fixed Rate and Adjustable Rate.
- Fixed Rate home mortgage loans have a fixed principal and interest payment over the life of the loan and normally require an escrow for taxes and insurance which can change. Loan terms can range from 5 to 30 years. Loan to value ratios can normally be up to 80% of the lower of cost or appraisal, and in some instances up to 95% with mortgage insurance. Our Mortgage Loan Calculator can estimate your principal and interest payment.
- Adjustable Rate home mortgage loans (ARMs) usually start with lower rates than fixed rate loans. The rate and payment is normally fixed for an initial term of 1 to 7 years and adjust annually within certain limits after the initial fixed rate period. Review our Variable Rate Mortgage Progam disclosures for 3/1, 5/1 and 7/1 ARM loans for a description of how these loans work. Loan terms can range from 10 to 30 years Contact a loan officer for more details.
Mackinac analyzes each Conventional loan application to determine whether better loan terms can be had for you by selling the loan to a government agency, to another investor, or keeping the loan in its own portfolio.