CONVENTIONAL - Conventional loans are viewed as the most secure loans because their loan-to value ratios are often lowest. Traditionally the ratio is 80 percent of the value of the property or less because the borrower makes a down payment of at least 20 percent

To qualify for a conventional loan under Fannie Mae guidelines, the borrower's monthly housing expenses, including Principal Interest must not exceed 28 percent of total monthly gross income. Also, the borrower's total monthly obligations, including housing costs plus other regular monthly payments must not exceed 36 percent of his or her total monthly gross income. Loans that meet these criteria are called conforming loans.

Conforming loan limits for first mortgages are the following:

One-family loans: $417,000
Two-family loans: $533,850
Three-family loans: $645,300
Four-family loans: $801,950
Note: Maximum original loan amounts are 50 percent higher for first mortgages on properties in Alaska, Hawaii, Guam and the U.S. Virgin Islands.

Documentation and fair-to-good credit are necessary.
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95% PURCHASE – 5% Down payment required and closing costs can be financed up to 6% of the purchase price. First time homebuyer status not required. This program is available only if the borrower can provide to the lender income and assets documentation.
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JUMBO LOANS - Offers 15, and 30 year fixed rate mortgages as well as competitive ARM products with stated and full documentation of income and assets.
2009 Jumbo Loan Limits are:
One-family loans: $625,500
Two-family loans: $800,775
Three-family loans: $967,950
Four-family loans: $1,202,925

Cash out and No cash out refinance are allowable.  Single family detached, Condo's, PUD's and single-family second homes can be financed with no prepayment penalty. 
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3 - 2 - 1 BUYDOWNS -As we all know, the mortgage industry is in the middle of a major shift where high fico's and full doc rule the day. A temporary buydown allows you to reduce the initial rate (or start rate) of a loan and, over time, the rate will increase to the normal note rate.  How does it work?  Depending on the specific buydown (the typical buydowns are 2-1 or 3-2-1 buydowns), your start rate will be 2 or 3 percent lower than your note rate.  Every year, the rate increases by 1% until you've reached the note rate.  The payment difference between the fully amortized payment on the note rate and current buydown rate is calculated up front and is placed in an escrow account at closing.  That escrow account is accessed with every monthly payment and the difference between the payments is taken from the account.  Benefits:  A borrower is qualified at a lower percentage rate and therefore needs less income to qualify for the loan.  In addition, the money to be put in the escrow account can come from any source other than the lender. It can come from the borrower themselves, from the seller (if it's a purchase), from the mortgage broker or from an interested third party (like your real estate agent who wants to close the deal).  It is not required to be sourced or seasoned.

Here's an example:  Suppose a loan amount of $350,000 with a rate of 6.5% and $400 a month in taxes and insurance. At 6.5% (note rate), the borrower would need to make $5000 a month ($60k a year) to qualify.  But with a 2-1 buydown, the borrower would qualify at 4.5% and would only need to make $4000 a month ($48,000).  During the first year, the difference in payment between a fully amortized payment at 6.5% and a fully amortized payment at 4.5% is about $435 a month ($5226 a year). During the second year, the difference in payment between a a fully amortized payment at 6.5% and a fully amortized payment at 5.5% is about $225 a month ($2700 a year).  The escrow account would need to have $7926 in order to cover the difference.  So for approximately $8k, a borrower is qualified at a lower percentage rate and therefore needs less income to qualify for the loan.
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