FLEXIBLE FINANCING

Conventional Mortgage Loans

Traditional mortgage financing with competitive rates, flexible terms, and options for every budget. The most popular loan type for homebuyers with good credit and stable income.

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Competitive Rates

Often lower interest rates than government-backed loans for qualified borrowers

Flexible Terms

15, 20, or 30-year fixed rates, plus ARM options to match your timeline

No PMI at 20% Down

Avoid mortgage insurance with 20% down, saving hundreds monthly

Program Overview

What Is a Conventional Loan?

Conventional loans are mortgages not insured or guaranteed by the federal government. Instead, they're backed by private lenders and conform to guidelines set by Fannie Mae and Freddie Mac. They're the most common type of mortgage in the United States, representing about 70% of all home loans.

These loans offer flexibility, competitive interest rates, and various term options. While they typically require higher credit scores and larger down payments than government-backed loans, they often provide lower overall costs for qualified borrowers and eliminate mortgage insurance once you reach 20% equity.

Conventional Loan at a Glance

Min Down Payment:

3%

For qualified first-time buyers

Credit Score:

620+

Minimum (higher for best rates)

Loan Limits (2024):

$766K

Up to $1.1M in high-cost areas

Loan Options

Types of Conventional Loans

Choose the loan structure that best fits your financial goals

Fixed-Rate Mortgages

MOST POPULAR

Lock in your interest rate for the entire loan term. Your monthly principal and interest payment never changes, providing predictability and stability for budgeting.

15

15-Year Fixed

Lower rates, higher payments, build equity faster. Save significantly on interest.

20

20-Year Fixed

Middle ground between 15 and 30-year terms. Balanced payments and interest savings.

30

30-Year Fixed

Lowest monthly payment option. More flexibility in your budget, most common choice.

Best For:

Buyers who plan to stay in their home long-term and want payment certainty. Ideal for those who value stability over flexibility.

Adjustable-Rate Mortgages (ARMs)

LOWER START

Start with a lower fixed rate for an initial period, then adjust annually based on market conditions. Rate caps protect you from dramatic increases.

5/1

5/1 ARM

Fixed for 5 years, then adjusts annually. Popular for buyers expecting to move or refinance.

7/1

7/1 ARM

Fixed for 7 years, then adjusts annually. More stability than 5/1 with still-lower initial rates.

10/1

10/1 ARM

Fixed for 10 years, then adjusts annually. Nearly a decade of payment certainty at lower rates.

Best For:

Buyers who plan to move or refinance within 5-10 years, or expect income to increase. Great for maximizing purchasing power initially.

Primary Residence

Best rates and terms for homes you'll live in full-time. Lowest down payment options available.

Second Home

Finance your vacation property or getaway home. Typically requires 10% down and can't be rented full-time.

Investment Property

Build your rental portfolio. Usually requires 15-20% down with slightly higher rates than primary homes.

Modern home
KEY ADVANTAGES

Why Choose a Conventional Loan?

Conventional loans offer numerous benefits for qualified borrowers, from competitive rates to flexible options that government-backed loans can't match.

Lower Interest Rates

Typically offer better rates than FHA or VA loans for borrowers with good credit

PMI Can Be Removed

Once you reach 20% equity, PMI automatically cancels—unlike FHA's lifetime MIP

More Property Flexibility

Can be used for second homes, investment properties, and unique property types

Higher Loan Limits

Borrow up to $766,550 (or $1.1M+ in high-cost areas) without needing a jumbo loan

Qualifications

Conventional Loan Requirements

What you need to qualify for a conventional mortgage

Credit & Income

  • Minimum 620 credit score (higher for best rates)
  • 740+ score typically gets best pricing
  • Debt-to-income ratio typically 43% or lower
  • Stable, verifiable employment (2+ years)
  • Recent pay stubs and tax returns

Down Payment Options

  • 3% minimum for qualified first-time buyers
  • 5% minimum for most other buyers
  • 10% down for second homes
  • 15-20% down for investment properties
  • 20% down eliminates PMI requirement

About Private Mortgage Insurance (PMI)

If you put down less than 20%, you'll pay PMI, typically 0.5-1.5% of the loan amount annually. The good news? Once you reach 20% equity through payments or appreciation, PMI automatically cancels. This is a major advantage over FHA loans, where mortgage insurance lasts the life of the loan.

3%

Minimum Down Payment

20%

No PMI Required

43%

Maximum DTI Ratio

Quick Estimate

Calculate Your Monthly Payment

See what your payment would look like with different down payment amounts

Common Questions

Conventional Loan FAQ

What's the difference between conforming and non-conforming conventional loans?

Conforming loans meet Fannie Mae and Freddie Mac guidelines, including loan limits ($766,550 in most areas for 2024). They typically offer better rates. Non-conforming loans—like jumbo loans—exceed these limits or don't meet other guidelines, often with stricter requirements.

Can I get a conventional loan with less than 20% down?

Yes! You can get a conventional loan with as little as 3% down if you're a qualified first-time buyer, or 5% for most other buyers. You'll pay PMI until you reach 20% equity, but it's often cheaper than FHA mortgage insurance and can be removed later.

How is PMI different from FHA mortgage insurance?

PMI on conventional loans automatically cancels once you reach 20% equity and typically costs 0.5-1.5% annually. FHA mortgage insurance costs 0.85% annually and lasts for the life of the loan if you put down less than 10%. For most borrowers, conventional PMI is more affordable long-term.

Should I choose a 15-year or 30-year mortgage?

It depends on your financial goals. A 15-year mortgage has lower rates and saves tens of thousands in interest, but has higher monthly payments. A 30-year mortgage offers lower monthly payments and more financial flexibility. Consider your budget, income stability, and how long you plan to stay in the home.

When does an ARM make sense?

ARMs can be a smart choice if you plan to move or refinance within 5-10 years, as the initial rates are typically lower than fixed rates. They're also good if you expect your income to increase significantly. However, if you want long-term payment certainty and plan to stay put, a fixed-rate mortgage is usually better.

Can I use a conventional loan for a multi-unit property?

Yes! You can use a conventional loan to buy a 2-4 unit property as your primary residence. If you live in one unit and rent out the others, you can even use the rental income to qualify. Down payments start at 5% for primary residences, though 15-25% is typical for pure investment properties.

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Client Stories

What Our Clients Say

JH

Jenny H.

They very professional, attentive, always responding to emails and text messages in a quick manner, and very helpful throughout the process. She made the whole process as seamless as possible and most importantly we had a clear to closing in less than a month. I would highly recommend them to your family and friends!!!

TK

Trevor K.

"They are tremendous to work with and true assets for their clients. They always put the people they are helping first and always do whatever they can to help! Great mortgage brokers, even better people!"

JA

Jennifer A.

They great to work with. We've been working for several months together and she was so patient and prompt with the home buying process. Thanks to her great team we where able to close within the month of our offer which in today's market it's not as common. Thank you!!!

Ready to Get Started with a Conventional Loan?

With competitive rates, flexible terms, and options for every situation, conventional loans offer an excellent path to homeownership. Let's find the right loan for you.

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