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Conventional Loans

Conventional Loans are some of the most common loans in the mortgage industry. These are loans which conform to the standards set by government-sponsored agencies Freddie Mac and Fannie Mae. The standardization across the loan requirements make the loans quite popular. Some benefits to a conventional loan include that mortgage insurance is not required up front or at all if the buyer meets a 20% down payment. A home bought with a conventional loan is permitted to be used as an investment property. The appraisal requirements are less strict which can help your closing go more quickly.

Requirements

  • Down payment (varies) 
  • For down payments less than 20%, Private Mortgage Insurance is required 
  • Credit score, usually at or above 620 
  • Debt-to-Income Ratio (DTI) usually has to be below 50% 
  • Loan size: For a conforming conventional loan, your loan must fall within the loan limits set by Fannie Mae and Freddie Mac. The loan limit changes annually.  

To get started, find an advisor near you.

To learn more about other mortgage solutions, visit the products page.