Conventional Loans

A Conventional Mortgage is simply any mortgage loan that is not insured or guaranteed by the federal or state government. Conventional Mortgages typically require a down payment, usually 3%–20%. They also have higher income and credit score requirements than government loans. Most lenders have an overlay of a 620 credit score.

Conventional Mortgages can have a fixed interest rate or an adjustable interest rate. Typical fixed-rate loans have a term of 30 or 15 years. However, Globe Mortgage offers 30-year, 25-year, 20-year, 15-year, and 10-year fixed-rate options.

With an Adjustable-Rate Mortgage (ARM), the interest rate stays constant for a term and then fluctuates based on market conditions. Globe Mortgage offers a 10/1 ARM, 7/1 ARM, 5/1 ARM, and 3/1 ARM.

Conventional Mortgages are also categorized as conforming or non-conforming. If a loan meets the underwriting requirements set forth by the quasi government-sponsored entities Fannie Mae and Freddie Mac, it is considered a conforming loan. If a loan does not meet all these requirements, it is considered a non-conforming loan.

One of the main factors that determine whether a mortgage is conforming is the loan amount. Generally, a mortgage with a loan amount below $832,750 is considered conforming, whereas any loan amount above $832,750 is considered non-conforming, or a Jumbo Mortgage. Conforming limits may be higher in areas of the country with more expensive housing; for example, the conforming limit is $1,249,120 in Alaska and Hawaii. Jumbo Mortgages usually have a higher interest rate because they carry greater risk.

What are the benefits of a Conventional Mortgage?

Conventional Mortgages offer the following features:

• Specialty first time home buyer programs such as HomeReady & Home Possible which allows for a lower down payment than FHA loans.
• No private mortgage insurance is required with a 20% down payment, which is a great advantage.
• Lower closing costs and fees.
• Ability to waive escrow payments.
• Fewer bureaucratic hurdles, making the loans quicker to process.
• No government stipulations and prepayment penalties if you sell or refinance your house.

Who may benefit from a Conventional Mortgage?

Conventional Mortgages are ideal for buyers with excellent credit who can afford a down payment.

Conventional One Time Close

One-Time Close New Construction loans—borrowers get the dream home they want with a faster, easier process and one closing: one interest rate with the option to modify down if the market improves, one down payment, one full credit report to order, and one approval.

Conventional loans — program highlights

*Program guidelines subject to change; consult your Loan Officer for current eligibility.

USDA Loans

Globe Mortgage’s USDA Home Loan Program provides financing for low- to moderate-income homebuyers purchasing in eligible rural areas as defined by the U.S. Department of Agriculture. Household income must not exceed established limits for the location.

Benefits

• 100% financing on a fixed 30-year loan (based on appraised value)
• No down payment required; competitive interest rates
• Guarantee fee may be included in financing
• Seller contributions toward closing costs may be permitted (subject to limits)
• Gifts or grants from family, friends, and non-profit agencies may be allowed

Qualifications typically include income limits, eligible property location, and minimum credit scores (often 640+). Contact a Loan Officer to confirm current USDA maps and limits.

FHA Loans

FHA-insured loans are funded by your lender and insured by the Federal Housing Administration—offering flexible guidelines that benefit many first-time buyers and those without perfect credit or large down payments.

Highlights

• Low down payments—as low as 3.5%
• Fixed- and adjustable-rate options
• Gift funds may be used for down payment and closing costs
• No prepayment penalty; flexible qualification compared to many conventional programs

Popular options include FHA 203(b) purchase/refinance, FHA 203(k) renovation, and energy-efficient mortgages. Your Loan Officer can match the right FHA product to your goals.

VA Loans

Globe Mortgage offers VA loan products for active-duty service members, veterans, and eligible surviving spouses—with favorable terms and competitive rates.

Features

• No down payment in many cases (subject to VA and lender guidelines)
• No monthly mortgage insurance; negotiable interest rates
• VA funding fee may be financed; reduced fees with down payment; exemptions for eligible disabled veterans
• Closing costs comparable to other financing types; seller contributions may apply
• Assumable with VA approval; no prepayment penalty

Eligibility is based on VA requirements (Certificate of Eligibility, discharge status, occupancy, etc.). Ask us how a VA loan fits your purchase or refinance.

FHA 203(k) Renovation Loans

FHA 203(k) loans combine purchase or refinance with repair/remodel costs in one loan—one application, one closing, one payment. Loan amounts consider the after-improved value (often up to 110% of after-improved value within FHA limits).

Benefits

• One loan for acquisition/refinance plus improvement funds
• Competitive fixed or adjustable rates; low down payments starting at 3.5% of acquisition + repair costs
• Funds held in escrow and disbursed as work completes
• Streamline 203(k) available for smaller/cosmetic projects (limits apply)

Owner-occupied properties; minimum repair thresholds and eligible improvement types apply. Luxury items such as pools are generally not allowed.

Refinancing

Refinancing replaces your existing mortgage with a new one—often to lower the rate, change the term, switch between fixed and ARM, or access equity. If you have a first and second lien, you may refinance into a single new loan.

Potential benefits

• Lower rate and monthly payment
• Shorten or lengthen the loan term
• Take cash out for improvements or other needs
• Convert an ARM to a fixed rate (or obtain improved ARM terms)

Refinancing has costs; it usually makes sense if you’ll keep the home long enough to recoup those costs. If you currently have an FHA loan, ask about an FHA Streamline Refinance.

FHA Streamline Refinance

Designed for existing FHA-insured homeowners: streamlined processing, and an appraisal may not be required. You must occupy the home as your primary residence and show an acceptable payment history.

• Typically a net tangible benefit (e.g., meaningful reduction in P&I + MI, or ARM to fixed)
• Seasoning requirements apply (payments made and time since closing)
• Available as fixed- or adjustable-rate; no prepayment penalty

Contact us to see if you qualify under current FHA guidelines.

FHA One Time Close

An FHA One-Time Close (OTC) loan combines construction financing, land purchase, and permanent mortgage into a single 30-year fixed loan with one closing, requiring only 3.5% down. It is designed for new stick-built, manufactured, or modular homes and can save on closing costs while locking in rates earlier.

Key features

• Single closing before construction begins—no separate loan conversion closing.
• Low down payment: minimum 3.5%, sometimes offset by land equity.
• Builder requirements: licensed general contractor; owner-builder generally not allowed.
• Loan limits: based on FHA county limits for your area.
• Payments: often no borrower payments during construction (program dependent).
• Primary residence only; typically one-unit.

Qualification & process

Credit score: many lenders look for 620–640+ (FHA floor may be lower). The process includes land purchase, closing, construction, and conversion to permanent financing when complete. Both borrower and builder must be approved by the lender.

VA IRRL Home Loan

Also called a “VA-to-VA” loan, the Interest Rate Reduction Refinance Loan (IRRRL) refinances an existing VA loan to lower the rate, move from ARM to fixed, or both—with streamlined documentation in many cases.

• Must refinance an existing VA loan into a new VA loan
• Net benefit to the borrower required (rate/payment reduction or ARM to fixed)
• Closing costs may be rolled into the new loan; terms from 10–30 years often available
• Work with a VA-experienced lender for current VA requirements

VA One Time Close

• Available on 30-year fixed loans
• Loans up to $4M
• Eligible on primary home purchases and cash-out refinances*
• 580+ FICO, up to 100% LTV
• DU and LP eligible
• 11-month maximum build period with 1-month modification period (build period deducted from loan term)
• No monthly payments during the build period

*Subject to investor and VA guidelines.

Non QM Loans

Non-QM (non-qualified mortgage) loans do not meet standard CFPB “QM” criteria and may offer flexible documentation (e.g., bank statements instead of W-2s) and broader credit parameters. They serve self-employed borrowers, investors, and those with unique income patterns.

Examples

• Bank statement loans—12–24 months of statements to evidence income.
• DSCR loans—qualify from property cash flow for investors.
• Asset-based—use liquid assets to qualify.
• Recent credit events—options after bankruptcy or foreclosure (guidelines vary).
• Higher DTI—may allow ratios above 43%.

Related terms: Alternative income documentation, non-qualified mortgage, flexible underwriting, portfolio loan.

Pros: Access for non-traditional borrowers; often faster paths when eligible.
Cons: Higher rates and larger down payments (often 15%–30%) are common due to risk.

DSCR 1-4 Unit Loans

Our DSCR product is built for real estate investors—qualification is based on the subject property’s cash flow, not traditional personal income documentation.

• Low or no DSCR ratio options (program specific)
• Loan amounts up to $5 million
• Minimum FICO 640
• Up to 85% LTV on purchase and rate/term; cash-out up to 75%
• Cash-out up to $1 million; proceeds may help meet reserves
• SFR, PUD, townhomes, 2–4 units, condos, non-warrantable condos
• 15-year fixed, 30-year fixed, 30-year fixed I/O, 5/6 ARM, 5/6 ARM I/O
• Gift funds for down payment, closing costs, and reserves (with documented minimum borrower contribution)
• First-time investors allowed up to 80% LTV
• Up to 6% seller concessions; foreign nationals; LLC vesting
• 0–6 month ownership seasoning options with appraised value

DSCR 5-10 Unit Loans

Multifamily financing for business-purpose borrowers—often priced more competitively than typical commercial programs while using standard DSCR qualification. A 1.25 DSCR threshold is common.

• Credit scores down to 680
• LTV up to 75%
• Loan amounts up to $3 million
• Standard 6 months PITIA
• Vesting in LLC or other entity
• Interest-only options; seller concessions allowed

HELOAN / HELOCs

Closed-end seconds (HELOAN) let homeowners tap equity in a lump sum without refinancing the first mortgage—often without affecting the rate on the original loan.

• Cash out without refinancing the existing first lien
• Seconds may not require mortgage insurance; fixed terms often available
• Rates on seconds may beat typical HELOC pricing
• May pair with a first lien to reduce cash-to-close on a purchase*
• Purchase, rate/term, and cash-out options; credit scores down to 660; amounts up to $1,000,000; max CLTV 85% in many cases

DSCR second (investors): cash-out or renovate rentals; max loan $500,000, min $75,000; min FICO 660; max CLTV 80%; SFR, PUD, townhomes, 2–4 units; long-term rentals; min DSCR 1.0; qualification from property cash flow.

HELOC: amounts $50,000–$1M; DTI 50%; CLTV up to 90% primary / 85% second / 75% investment; min FICO 660; bank statements for self-employed; variable-rate draw period with stated amortization—ask about current terms.

Bank Statement Loans

Non-QM loans for self-employed borrowers, freelancers, and business owners—qualify using 12–24 months of personal or business bank statements instead of traditional tax returns. Deposits illustrate cash flow after expense factors.

Highlights

• Strong fit for high write-offs on tax returns
• Typically higher rates than conventional; larger down payments common
• DTI flexibility—sometimes up to ~60%

Prepare: gather statements, business license or CPA letter, and review credit (620–700+ targets better pricing).

P&L Only Loans

Non-QM option for self-employed borrowers using a CPA-, EA-, or qualified preparer–issued profit & loss statement (12 or 24 months) instead of full tax returns or bank statements.

• Loan amounts up to ~$4MM; LTV often up to 80–85%
• Typically 50%+ business ownership and 2+ years self-employment
• May allow lower credit scores and recent credit events (case by case)
• Interest-only options may be available

vs. bank statement: P&L emphasizes business profitability; bank statement emphasizes deposits. Slim margins may be harder on P&L than on bank statement programs.

1099 Only Loans

Non-QM loans for independent contractors and freelancers—qualify using 1099 income (and sometimes bank statements) without traditional tax-return income calculation.

• Often 620–720+ credit; 10–20% down typical
• Loan amounts may reach multi-million depending on lender
• Higher DTI flexibility possible

vs. bank statement: 1099 focuses on reported annual contractor earnings; bank statement uses deposits.

Hard Money Loans

Short-term, asset-based financing for investors—often used for fix-and-flip, bridge scenarios, or properties that don’t qualify for traditional financing. Collateral value drives approval; pricing and leverage reflect risk.

• Fast funding; credit may be less emphasized than collateral
• Higher rates (often mid–high single digits and up), points/fees, and short terms (e.g., 6–24 months) with balloon structures are common
• Typical LTV ranges often ~50–75% depending on scenario

Limited Doc Commercial Loans

Commercial financing with reduced documentation—often bank statements, rent rolls, P&Ls, credit, and borrower declarations rather than full tax-package underwriting. Useful when speed matters and collateral/income story is strong.

• Faster decisions (sometimes 24–48 hours in select cases)
• Approval leans on credit, collateral, and cash flow indicators
• Rates typically above traditional bank commercial; shorter terms and lower LTVs may apply

Uses include investment CRE, business expansion, equipment, working capital, and bridge situations. Terms vary widely by lender and deal—speak with a commercial specialist.