The United States government makes mortgage loans available to the public, using funds from the Bond Market. There are various types of loans to choose from, collectively called CONFORMING LOANS. These loans can be generally classified in two categories: 1. Loans known as CONVENTIONAL LOANS are generally open to all qualifying borrowers and are administered by entities known by acronyms such as "Fannie Mae" and "Freddie Mac". 2. Another set of loans, designed for a more specific set of borrowers and known simply as GOVERNMENT LOANS, are also available. These loans are administered by FHA and VA, among others. CONFORMING LOANS, since they are essentially subsidized by the Federal government, are available at interest rates somewhat lower than the prime rate, which is the rate the banks and other lending institutions charge their best customers. While there is no direct correlation, it is a good rule of thumb to expect conforming rates to be one to two percentage points lower than the prime rate. Additionally, since public funds are being used, stringent rules and guidelines apply to the approval of these loans. Credit history, income and debt issues, and job stability are among these guidelines. A relatively high percentage of borrowers do not qualify for a Conforming loan. Funds are still available for these home buyers through the private sector. This type of financing is known as a NON CONFORMING LOAN. Since this money does come from the private sector, it must be expected to carry an interest rate somewhat above the prime rate. If we assume one to two percentage points above the prime rate for a Non Conforming loan, it is easy to see that this type loan rate will be 2 to 4 percentage points higher than a Conforming loan. A Non Conforming loan is much easier to obtain, however, than a Conforming Loan, and is therefore often an excellent temporary solution for a buyer. Even at a higher interest rate, the tax benefits involved, as well as the equity being generated, make this type loan a better proposition than renting. Almost any situation which prohibits the obtaining of a Conforming loan can be cured within three years, and often sooner. THE PLAINSMEN GROUP works hard to obtain affordable financing, both short term and long, for our customers. A typical approach for a customer who does not qualify for a Conforming loan is as follows: 1. We will use our expertise to resolve any problems that can be cured immediately. 2. We will obtain the best terms possible for the borrower in a Non Conforming loan. 3. At the same time, we will develop a plan with the borrower to resolve and correct the situation as it exists. 4. We will constantly monitor the process with the customer, evaluating the progress. 5. As soon as possible (normally two to three years) we will refinance the customer into their permanent Conforming Loan.