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Maryland Home Search: Loan Differences
Conventional Loans are secured by
government sponsored entities or GSE's such as
Fannie
Mae and Freddie Mac or by private investors for loan
amounts higher than the limits set by the GSE's.
Conventional loans can be made to purchase or refinance
homes with first and second mortgages on single family
to four family homes.
In general, Fannie Mae and Freddie Mac's single family,
first
mortgage loan limit is $333,700 in 2004. This
limit is reviewed annually and, if needed, changed to
reflect changes in the national average price for single
family homes. The current loan limit applies to all
conventional mortgages delivered after January 1, 2004.
2004 Conventional Loan Limits
First mortgages -
One Family loans: $333,700
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Two Family loans: $427,150
-
Three Family loans: $516,300
-
Four Family loans: $641,650
Note: Maximum original loan amounts are 50 percent
higher for first mortgages on properties in Alaska,
Hawaii, Guam and the U.S. Virgin Islands.
Second Mortgages -
$150,350 (in Alaska, Hawaii, and the US Virgin Islands:
$225,525)
Loans which are larger than the
limits set by Fannie Mae and Freddie Mac are called
jumbo loans.. Because jumbo loans are not funded by
these government sponsored entities, they usually carry
a higher
interest rate and some additional underwriting
requirements. A strategy to lower your overall interest
payments if your purchase or refinance balance is above
$333,700 is to use a combination of both first and
second trust money, referred to as an 80/10/10, 80/15/5
or 80/20. Every situation is different, but it is one
more option to consider.
In addition to common loan structures such as fixed
rate, adjustable rate and balloon loans, Fannie Mae and
Freddie Mac also have loan programs for low to no down
payments, community lending and affordable housing
initiatives, construction to permanent,
home improvement
and reverse mortgages.
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in Southern Maryland and need to get the most current
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