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Homebuyers Discover the Renasant Bank Advantage: Securing financing in Macon Georgia

Renasant Mortgage is a full-service mortgage solutions provider offering a wide array of home lending options from the most traditional secondary market conventional loan options as well as a full suite of government loans. What sets us apart from other mortgage lending institutions is the ability to also offer a full suite of portfolio loan options (In-House Mortgages) that we hold “internally” to allow flexible options such as construction-perm loans, renovation and repair loans, loans for Physicians, and more. Renasant Mortgage is also committed to the support and growth of our Community with our In-House Community Home Buyer Loan and down payment assistance options.

Hughes Pinson
Division President, Senior VP
4961 Forsyth Road Macon-Forsyth, GA 31210

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How Renasant Bank is Helping Homebuyers

You found your dream home and it needs some work. Don’t let this stop you from writing that offer. Renasant Renovation and Repair Loans are designed to help with repairs. With a Renasant Renovation and Repair Loan, you can transform any property into the perfect space for your family. Enjoy competitive, mortgage-like interest rates and flexible credit options as you finance the upgrades you envision. Learn More

The History of Renasant Bank

Renasant Bank has a rich history that dates back to its founding in 1904. Originally established as the Bank of Rienzi in Rienzi, Mississippi, it aimed to serve the local community’s banking needs. Over the years, the bank grew and expanded its services, reflecting the evolving financial landscape.

In 1934, the bank changed its name to Renasant Bank, derived from the term “renaissance,” symbolizing rebirth and growth. This change was emblematic of the bank’s commitment to innovation and service.

Throughout the 20th century, Renasant Bank expanded its footprint across Mississippi and into neighboring states. The bank adopted a customer-focused approach, emphasizing personalized service and community involvement. This commitment helped it build a strong reputation and loyal customer base.

The bank’s growth continued with strategic mergers and acquisitions. Renasant Bank became a publicly traded company, further increasing its capital and enabling broader expansion, with assets of approximately $17.5 billion and 185 banking, lending, mortgage, and wealth management offices throughout the Southeast In 2004.

Renasant has consistently prioritized technology and customer experience integrating modern banking solutions while maintaining its community roots. Today, Renasant Bank is recognized as one of the Southeast’s leading financial institutions, dedicated to supporting local communities and fostering economic growth.

Understanding Conventional Mortgages for Residential Homes

When considering purchasing a home, one of the most critical decisions you’ll face is choosing the right type of mortgage. Among the various options available, conventional mortgages are a popular choice for many homebuyers due to their flexibility and favorable terms. In this blog, we will delve into the details of conventional mortgages, exploring their benefits, requirements, and how they compare to other types of home loans.

What is a Conventional Mortgage?

A conventional mortgage is a type of home loan that is not insured or guaranteed by the federal government. Instead, these loans are offered by private lenders such as banks, credit unions, and mortgage companies. Because they are not backed by the government, conventional mortgages often have stricter requirements compared to government-insured loans like FHA and VA loans.

Types of Conventional Mortgages

Conventional mortgages come in two main types: conforming and non-conforming loans.

  1. Conforming Loans: These loans adhere to the guidelines set by Fannie Mae and Freddie Mac, two government-sponsored enterprises that purchase mortgages from lenders and sell them to investors. Conforming loans must meet specific criteria, including loan limits, which vary by location. As of 2023, the conforming loan limit for a single-family home in most areas of the United States is $726,200.
  2. Non-Conforming Loans: Also known as jumbo loans, non-conforming loans exceed the loan limits set by Fannie Mae and Freddie Mac. These loans are typically used for purchasing high-value properties and come with stricter underwriting requirements and higher interest rates due to the increased risk for lenders.

  3. Benefits of Conventional Mortgages

    Conventional mortgages offer several advantages that make them an attractive option for many homebuyers:

    1. Lower Interest Rates: Because conventional loans are considered less risky for lenders, borrowers with good credit scores and a solid financial history often qualify for lower interest rates compared to government-insured loans.
    2. Flexible Terms: Conventional mortgages come with various term lengths, typically ranging from 10 to 30 years, allowing borrowers to choose a repayment plan that best suits their financial situation.
    3. No Private Mortgage Insurance (PMI) with 20% Down: If you can make a down payment of at least 20% of the home’s purchase price, you can avoid paying PMI, which is an additional monthly cost required by lenders to protect themselves in case of default.
    4. Higher Loan Limits for Conforming Loans: The loan limits for conforming conventional loans are higher than those for FHA loans, making them a better option for purchasing more expensive homes.
    5. Refinancing Options: Conventional mortgages offer flexible refinancing options, allowing borrowers to take advantage of lower interest rates or access their home equity for other financial needs.

Requirements for Conventional Mortgages

To qualify for a conventional mortgage, borrowers must meet certain criteria, including:

  1. Credit Score: Most lenders require a minimum credit score of 620 for conventional loans. However, borrowers with higher credit scores (typically 740 and above) are more likely to secure the best interest rates and terms.
  2. Debt-to-Income Ratio (DTI): Lenders typically prefer a DTI ratio of 43% or lower, which means your total monthly debt payments (including your mortgage) should not exceed 43% of your gross monthly income.
  3. Down Payment: While it’s possible to obtain a conventional mortgage with a down payment as low as 3%, putting down at least 20% will help you avoid PMI and reduce your monthly payments.
  4. Employment and Income Verification: Lenders will require proof of stable employment and sufficient income to ensure you can afford the mortgage payments. This may include pay stubs, tax returns, and bank statements.
  5. Reserve Funds: Some lenders may require you to have reserve funds (savings) equivalent to a certain number of months’ worth of mortgage payments to cover potential financial hardships.

Comparing Conventional Mortgages to Other Loan Types

To determine if a conventional mortgage is the best option for you, it’s essential to compare it to other types of home loans:

  1. FHA Loans: Insured by the Federal Housing Administration, FHA loans are designed for borrowers with lower credit scores and smaller down payments. While FHA loans are easier to qualify for, they come with mandatory mortgage insurance premiums (MIP) for the life of the loan, which can increase the overall cost.
  2. VA Loans: Available to eligible veterans, active-duty service members, and certain members of the National Guard and Reserves, VA loans are backed by the Department of Veterans Affairs. These loans offer competitive interest rates, no down payment requirements, and no PMI, making them an excellent option for those who qualify.
  3. USDA Loans: Backed by the United States Department of Agriculture, USDA loans are designed for low-to-moderate-income borrowers purchasing homes in eligible rural areas. These loans offer 100% financing (no down payment) and reduced mortgage insurance costs, but they have strict income and property eligibility requirements.

Applying for a Conventional Mortgage

The application process for a conventional mortgage involves several steps:

  1. Pre-Approval: Before you start house hunting, it’s a good idea to get pre-approved for a mortgage. This involves a thorough review of your financial situation by a lender, who will then provide a pre-approval letter indicating the loan amount you’re qualified for. Having a pre-approval letter can strengthen your offer when you find the right home.
  2. Home Search and Offer: With your pre-approval in hand, you can begin searching for your dream home. Once you find a property you want to purchase, you’ll make an offer to the seller. If the offer is accepted, you’ll enter into a purchase agreement.
  3. Loan Application: After your offer is accepted, you’ll complete a formal mortgage application with your lender. This involves providing detailed information about your finances, employment, and the property you’re purchasing.
  4. Loan Processing and Underwriting: The lender will process your application, verify your financial information, and order an appraisal of the property to ensure it meets the loan requirements. An underwriter will review your application and the appraisal report to determine if you qualify for the loan.
  5. Closing: If your loan is approved, you’ll move on to the closing process. During closing, you’ll sign the final loan documents, pay any closing costs, and officially take ownership of the home.

Tips for Securing a Conventional Mortgage

To increase your chances of securing a conventional mortgage with favorable terms, consider the following tips:

  1. Improve Your Credit Score: Take steps to boost your credit score by paying down debt, making on-time payments, and correcting any errors on your credit report.
  2. Save for a Larger Down Payment: Aim to save at least 20% of the home’s purchase price to avoid PMI and reduce your monthly mortgage payments.
  3. Reduce Your Debt-to-Income Ratio: Pay down existing debts and avoid taking on new debt before applying for a mortgage to improve your DTI ratio.
  4. Get Pre-Approved: Obtain a mortgage pre-approval before house hunting to understand your budget and demonstrate your seriousness to sellers.
  5. Shop Around for Lenders: Compare mortgage rates and terms from multiple lenders to find the best deal for your financial situation.

Conclusion

Conventional mortgages are a versatile and attractive option for many homebuyers, offering competitive interest rates, flexible terms, and the potential to avoid mortgage insurance with a substantial down payment. By understanding the requirements and benefits of conventional loans, you can make an informed decision and take the necessary steps to secure the best mortgage for your new home. Whether you’re a first-time homebuyer or looking to upgrade to a larger property, a conventional mortgage may be the key to unlocking your dream of homeownership. Get in touch with Renasant Bank today to discover how they can assist you in achieving your financial goals.

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Sheridan Solomon and Associates​​ | Macon Magazine

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