There is no denying that Seattle, Bellevue, and other Washington housing markets are competitive. That’s why you need a competitive home loan to keep your rates affordable. Many customers shopping for mortgages in Washington are looking for conventional financing.
What is a Conventional Loan?
A conventional home loan is also called a “conforming” home loan. This is because it conforms to the conventional loan limits set and guaranteed by Fannie Mae and Freddie Mac. If you need a higher loan which surpasses those limits, you will have to apply for a jumbo loan.
What are the Conventional Loan Limits in
Fannie Mae and Freddie Mac set the conventional loan limits by county. To find out the loan limits where you wish to purchase a home, you need to look up the limits for that county.
Seattle and Bellevue are both located in King County. Here are the Bellevue and Seattle loan limits for 2019:
These are significantly higher loan limits than those in many other areas around the country. This is to accommodate the higher housing costs in the local real estate market.
How to Qualify for a Conventional Loan in
Seattle or Bellevue
To be eligible for a conventional loan in Bellevue, Seattle, or any other Washington location, you must meet these criteria:
- The financing you need must not be greater than the limits stated for your county.
- To qualify for the most affordable rates, the higher your credit score the better your rate and loan fees will be.
- Your debt-to-income ratio will need to demonstrate that you have the means to afford the mortgage. Your income must be steady and reliable.
- A down payment will be required. You should be prepared to put down anything from 3-20%. The amount of the down payment is contingent on your credit score and other factors.
While it is in your best interest to wait to apply for a conventional mortgage until your credit score and debt-to-income ratio are ideal, competitive rates and terms exist for customers with a wide range of financial situations.