 TITLE: What Is a Conforming Loan? CONTENT: Pros and Cons of Conforming Loans\n---------------------------------\nAs with any type of loan, a conforming loan comes with potential pros and cons.\nAmong the potential benfits as compared with non-conforming loans:\n*   Easier qualification\n*   Lower interest rate\n*   Lower FICO® Score requirement (620 versus 680 for most jumbo, or non-conforming, loans)\n*   Lower down payment\nWhy are conforming loans often simpler to get than a non-conforming loan? Because they're less risky for lenders, since they can sell these loans to Fannie Mae or Freddie Mac. Both of these government-sponsored entities provide stability to the U.S. home lending market, since they guarantee the principal and interest payments made by borrowers.\nThe Consumer Financial Protection Bureau notes that many of the mortgage loans that got borrowers into trouble during the 2008 housing crisis fell into the non-conforming category.\nAside from the drawback of the borrowing limit, a conforming loan may be tougher to obtain if you have a relatively low credit score or a high debt-to-income ratio. Furthermore, a conforming loan may give you less flexibility in terms of the type of property you can buy. For instance, the borrowing limit for a conforming loan may keep you from buying a home when you need to borrow more money than the limit allows. END