Mortgage Definitions
August 19, 2009 1:12 pm Book, First Time Home Buyer, Mortgage InsuranceConventional Mortgages
A mortgage is considered conventional if you have a down payment that is greater than 20% of the value of the property.
Why is this important?
It is important because if your mortgage is Conventional you will not have to pay the Mortgage Insurance fee but you may have to pay for other smaller fees like an appraisal.
High Ratio Mortgages
A mortgage is considered High Ratio if the down payment on a property is less than 20% of the value of the property.
Why is this important?
It is important because if your down payment is less than 20% you will be required to get Mortgage Insurance.
To find out more about why we have mortgage insurance check out my earlier post.
http://jasonpeatz.com/2008/05/lenders-mortgage-insurance-part-one/
To find out how the mortgage insurance is calculated check out my earlier post.
http://jasonpeatz.com/2008/06/mortgage-insurance-fees/
