Conventional Home Loans 2025

Conventional mortgages are the most common loan type in the U.S., backed by Fannie Mae and Freddie Mac guidelines. They’re great for well-qualified buyers and homeowners who want competitive pricing, clear terms, and options to remove PMI once equity grows.

Who Conventional loans fit best

• Strong/steady income and good credit (typically 620+)
   
• As low as 3% down for eligible first-time buyers; 5%+ for many others
   
• Buyers comparing FHA vs Conventional and planning to remove PMI
   
• Homeowners refinancing to drop PMI or shorten the term
   

Purchase highlights

• Down payment: 3%–20%+ depending on eligibility and goals
   
• PMI: required if <20% down; often cheaper with higher credit scores
   
• PMI removal: you can request removal near 80% LTV (conditions apply); automatic at 78% LTV under federal rules if you’re current
   
• Property types: 1–4 unit homes and many condos (project approval may apply)
   

Refinance use-cases

• Remove FHA MIP or Conventional PMI once you have 20%+ equity
   
• Lower your rate/payment or switch to a 15- or 20-year
   
• Cash-out to consolidate debt or renovate
   
• Possible appraisal waivers on some files (program-dependent)
   

Terms & structures

• Fixed-rate: popular 30-year, plus 20-, 15-, even 10- or 8-year options
   
• ARMs: 5/6, 7/6, 10/6 ARMs can offer lower starting payments if you expect to move or refi within 5–10 years
   

What we’ll verify
Credit, income, assets, debts, and property details. We’ll show side-by-side scenarios (monthly payment, cash-to-close, PMI vs no-PMI) so you can choose confidently.

Compare your options
Explore FHA, VA, and Jumbo alongside Conventional to see which delivers the best total cost and flexibility for your situation.

Get pre-approved
Start your Conventional pre-approval today—fast, secure, and tailored to your price range.

What is a Conventional loan?
A mortgage that follows Fannie Mae/Freddie Mac rules. It isn’t insured by FHA or guaranteed by VA.

How much down payment do I need?
As low as 3% for eligible first-time buyers; 5%+ is common for others. 20% avoids PMI.

What credit score do I need?
Guidelines vary by lender, but 620+ is a typical starting point. Higher scores can improve pricing and PMI.

How does PMI work—and can I remove it?
If you put <20% down, PMI applies. You can request removal near 80% LTV (with conditions), and it’s automatic at 78% if you’re on time.

Fixed vs ARM—how do I choose?
Fixed is predictable for long-term holds. ARMs can start lower if you expect to move or refinance in ~5–10 years.

Can I refinance from FHA to Conventional to drop MIP?
Yes—many homeowners refinance into Conventional once they have 20%+ equity to eliminate FHA MIP and/or reduce payment.