Conventional Loans
The most common way to finance a home. Flexible terms, mortgage insurance you can cancel later, and as little as 3% down for qualified buyers.
A conventional loan isn't backed by a government agency like the FHA, VA, or USDA. Most follow guidelines set by Fannie Mae and Freddie Mac, and they're the most widely used loan type in the country.
That flexibility is why they fit so many situations: a first home, a move up, a second home, or a rental you plan to hold.
How conventional loans work
Conventional loans come in fixed-rate and adjustable-rate versions across a range of terms. Qualified first-time buyers can get in with as little as 3% down. Repeat buyers often put down 5% or more.
Put down less than 20% and you'll usually pay private mortgage insurance (PMI). Here's the part borrowers like: unlike some government-backed programs, conventional PMI can be cancelled once you've built enough equity, so your payment drops down the road.
Conforming loan limits
Most conventional loans stay within the annual conforming loan limit. Anything above that limit is a jumbo loan, which Gene also originates. Ask him what the current limit is for your county before you shop.
A strong fit if…
- You have solid credit and want the widest set of options
- You want mortgage insurance you can cancel later
- You're buying a second home or a rental property
- You'd rather skip the upfront funding or insurance fees some government programs charge
Worth weighing
- Qualifying usually takes stronger credit than FHA
- With less than 20% down you'll pay PMI until you reach enough equity
- Loan amounts above the conforming limit become jumbo loans
Run your numbers
Compare other options
Is Conventional the right fit for you?
Gene will look at your goals and compare your options with no obligation. Get pre-qualified or call to talk it through.