Finance
In Colorado, a 'conforming loan' is one that:
AA. Conforms to state law regardless of size
BB. Meets Fannie Mae and Freddie Mac's guidelines for purchase, including maximum loan limits, credit, and income requirements✓ Correct
CC. Is guaranteed by the federal government
DD. Is originated by a federally chartered bank
Explanation
A conforming loan meets the standards set by Fannie Mae (FNMA) and Freddie Mac (FHLMC) for purchase in the secondary market, including loan size limits (the conforming loan limit, which is higher in high-cost counties like Denver metro), down payment, credit score, DTI, and documentation requirements. Conforming loans typically offer better interest rates than non-conforming (jumbo) loans.
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