Nonconforming Mortgage
A mortgage that does not meet the guidelines of Government Sponsored Enterprises (GSE) such as Fannie Mae and Freddie Mac, and therefore cannot be sold to Fannie Mae or Freddie Mac. GSE guidelines consist of a maximum loan amount, suitable properties, down payment requirements and credit requirements, among other things. Investopedia Says:
The percentage of annual mortgage originations that are conforming and nonconforming mortgages varies from year to year as market conditions change. Conforming mortgages are generally more traditional mortgages such as 30-year fixed rate mortgages. Negative amortization mortgages, for example, are nonconforming mortgages. Related Terms:
Fannie Mae - Federal National Mortgage Association - FNMA
Freddie Mac - Federal Home Loan Mortgage Corp - FHLMC
Negative Amortization
Prime
Prime Conforming |