Americans have been getting mortgage loans for many, many years now. Over time, banks and other financial institutions in the business of lending money gradually came to a consensus as to what the fundamental rules, regulations, guidelines and standards of a home mortgage loan should be. Two very large home mortgage loan institutions, the Federal National Mortgage Association (very commonly referred to as Fannie Mae) and the Federal Home Loan Mortgage Corporation (Fannie Mae's brother, Freddie Mac), played a big role in creating these guidelines. The criteria for a conforming loan were set by the Office of Federal Housing Enterprise Oversight (OFHEO).
The criteria for a conforming mortgage include paperwork and documentation requirements, loan limits for different types of mortgages, and other sundry guidelines. In general, however, when real estate industry professionals and lending professionals refer to a mortgage loan as a conforming loan, they are talking about its size: if the mortgage loan is over the limit set by OFHEO then it is called a jumbo mortgage or a non-conforming mortgage.
If you're thinking about buying a home and are wondering if you will qualify for a conforming loan, the answer will probably be "yes" if your credit is good. If it's not, you might have to apply for a non-conforming loan. Non-conforming loans are given to people with credit issues, and are the banks' way of covering their risks.
If you're unsure whether you qualify for a conforming mortgage loan or not you can get a free credit report to see if your credit history is good.
For different mortgage loan options try Go Banking Rate's easy 1,2,3 approach by typing in your zip code and selecting the different drop down options to specify what is most important for you in a home loan.
