Wholesale Lending Solutions
Conventional mortgages are a type of loan not offered or secured by a government entity. That means it is not backed by the Federal Housing Administration (FHA), the USDA Rural Housing Service, or the U.S. Department of Veterans Affairs (VA). Instead, it is guaranteed by a private lender like a bank or mortgage company or one of the Congressional-chartered private companies: the Federal National Mortgage Association the Federal Home Loan Mortgage Corporation.
What Are Fannie Mae & Freddie Mac Loans?
Fannie Mae and Freddie Mac are both private companies chartered by the U.S. Congress in order to provide a supply of mortgage funds throughout the country. Fannie Mae was first chartered in 1938 while Freddie Mac was chartered in 1970. While they were chartered by the U.S. government, they are not government entities. Instead, they are operated as a share-holder owned company.
Fannie Mae loans and Freddie Mac loans attract secondary mortgage market investors who might not otherwise want to invest by guaranteeing the timely payment of principal and interest on the underlying mortgages. Through this process, they continue to expand the pool of funds available for housing and mortgage lending.
Approximately two-thirds of the homeowners’ loans issued in the U.S. are conventional mortgages.
How It All Works
Potential borrowers need to complete an official mortgage application, just like any other mortgage application. The difference between conventional loans and subsidized loans is where the funding comes from. Conventional loans also tend to have higher interest rates and require higher down payments.
Borrowers will need to provide several documents to help them get approved for loans, these are pretty standard requirements.
- Proof of Income
- Employment verification
- Other documentation (driver’s license or state ID card, social security number)
BluePoint Mortgage is a direct seller to Fannie Mae, Freddie Mac, and Ginnie Mae, meaning we can offer flexible mortgage options that suit your borrowers.