What is a core feature of conventional loans that does not have uniform guidelines?

Conventional loans are characterized by being non-government-backed loans and often follow certain guidelines set by financial institutions and organizations like Fannie Mae and Freddie Mac. However, one of the core features that lacks uniform guidelines is the qualification standards.

Qualification standards can vary significantly between lenders, as each financial institution may impose its own specific criteria regarding debt-to-income ratios, credit score requirements, and income verification processes for borrowers. This flexibility allows lenders to tailor their offerings to different segments of the market and make lending decisions based on their risk assessments and business models.

In contrast, features like the repayment period length, types of properties financed, and servicing fees tend to adhere more closely to established practices across the lending industry, providing more consistency among conventional loans. Each lender's discretion regarding qualification standards makes it a core feature that does not have a standardized approach across the board.