| Sub-prime mortgage loans offer more flexibility than | | | | Mae buy mortgages |
| their conventional | | | | after they have been processed by a financial |
| mortgage loan cousins. With terms determined by | | | | company. This frees up |
| Freddie Mac and Fannie | | | | money for the lender to make more loans. However, |
| Mae, conventional loans have strict guidelines on loan | | | | Freddie Mac and Fannie |
| amounts, terms, | | | | Mae have tight guidelines on what types of loans they |
| and PMI requirements. With sub-prime mortgages, | | | | will purchase.Among these limitations are caps on loan |
| lenders can provide | | | | amounts. In 2006 the limits |
| more choices with an increase in rates.The Limits Of | | | | were set at $417,000 for a single family house. Every |
| A Conventional LoanConventional loans are often | | | | year these caps are |
| sought for their low rates. But those low | | | | reevaluated. |
| rates come with limitations. Freddie Mac and Fannie | | | | |