What is the right loan for you?
Portfolio lending is the forefront of lending innovation. It's the next best thing to a Fannie or Freddie loan. Meaning...guidelines that would normally hold up a loan are factored into rate and terms. These types of loans are great alternatives for people with anything from a foreclosure/short sale, bankruptcy or even someone who is self employed and needs a "bank statement only" loan.
The last 10 years was an era where lenders were scared to sell anything but traditional, Qualified Mortgages. But, as lenders realize that there are more buyers needing alternative products to facilitate the demand...new products are rising as great ways to buy houses.
Check out what is new in the market for buying everything from a single family house to apartment buildings.
These are your standard 30, 20, 15 and 10 year fixed loans and ARM's, like the 3/1, 5/1, 7/1, and 10/1. Fannie Mae and Freddie Mac loans are the ultimate goal for any financing because they have the lowest rate and best terms.
One term that is synonymous with Fannie and Freddie is the "conforming limit". Conforming means the loan amount meets their guidelines and max loan limits. There are 2 categories:
1) Standard conforming - $424,100
2) High Balance conforming - $636,150
Most counties in the immediate Bay Area qualify for both of these limits except for Sonoma County, set at $554,300 on the High Balance. Any loan amount higher than these limits are categorized as a Jumbo or Portfolio loan where rates can be higher, guidelines are tougher, and credit scores need to be higher.
Multi-Unit Max Limits:
Fannie Mae and Freddie Mac also have higher limits for multi-unit properties. For example, a 2 unit in Alameda County has a high balance limit of $800,775.