A conventional loan is a mortgage loan that is not backed by a government agency. These loans are backed by either Fannie Mae or Freddie Mac. Conventional loans are a great option if you have a solid credit score and little debt. You can avoid paying private mortgage insurance (PMI) by paying 20% of the loan upfront. If you are unable to make a large payment upfront, conventional loans are available with a down payment as low as 3%.
Thinking of getting a conventional loan? Here are a few key points:
- Down payment is as low as 3% on a primary residential purchase
- Guidelines for qualifying are more strict than an FHA loan
- Low debt to qualify
- If putting less than 20% down, then you are required to pay mortgage insurance
*Loan terms are subject to change. This information is meant for educational purposes and is not a commitment to lend. To qualify for a conventional mortgage loan, please reach out to our licensed loan officers, or apply online.
Why We Chose a Conventional Loan
We have done a couple of mortgage with The Staples Group now because the experience has been very enjoyable. We had worked with another lender in our first home purchase and were pleasantly surprised at how low the Staple Group rates were just how much they communicated with us during the process! When spending so much money it was nice to always know what was going on. After doing an FHA loan for our first home purchase, we opted for a conventional mortgage in our most recent transaction because we were able to come up with 20% down and avoid mortgage insurance entirely! It feels great to not pay mortgage insurance anymore!
-The Glauser Family