Conventional Mortgage

What is a Conventional Mortgage?

A conventional mortgage is a home loan that is not backed by a government agency. These loans typically offer competitive interest rates and flexible terms, making them the most popular choice for homebuyers with solid credit histories and stable incomes. Conventional loans conform to guidelines set by Fannie Mae and Freddie Mac, and can be used for primary residences, vacation homes, or investment properties.

Who It's For

Conventional loans are ideal for buyers with a credit score of 620 or higher, a consistent employment history, and the ability to make a down payment of at least 3%. They are especially advantageous for buyers who can put 20% down, as this eliminates the need for private mortgage insurance (PMI).

Key Benefits

• Down payment as low as 3% for first-time buyers
• No upfront mortgage insurance premium
• PMI can be removed once you reach 20% equity
• Available for primary homes, vacation homes, and investment properties
• Wide range of loan terms: 10, 15, 20, and 30 years
• Competitive interest rates for borrowers with strong credit

Eligibility Requirements

• Minimum credit score of 620
• Debt-to-income ratio typically under 45%
• Stable employment history (2+ years preferred)
• Down payment of 3–20%+ depending on loan type
• Property must meet standard appraisal requirements