Conventional Purchase

FHA is more forgiving on credit, but under current FHA rules, with less than 10% down its mortgage insurance lasts for the life of the loan. Conventional mortgage insurance can be removed at 20% equity and ends automatically at 22%. With stronger credit, conventional often costs less over time. With lower scores, FHA often wins. We price both.

Lenders look at your credit score, down payment, debt-to-income ratio, income history and the property. Many lenders look for a score of 620 or higher, and the down payment can be as little as 3% for qualifying buyers. Stronger credit and a larger down payment generally lead to better pricing.

Under current Fannie Mae and Freddie Mac programs, as little as 3% for qualifying first-time or income-eligible buyers on a primary residence. Many other buyers start at 5%. Second homes and investment properties require more. Putting less than 20% down adds private mortgage insurance.

Fannie Mae and Freddie Mac limit seller contributions to a percentage of the price, and the limit rises as your down payment goes up. Investment properties have a lower limit. We confirm the current limit for your down payment before you write the offer, so the seller credit is not wasted.

Under current guidelines, conventional loans can go as high as 50% when the file is approved through automated underwriting with strong compensating factors, such as reserves or a larger down payment. Many files are approved lower. We review your ratio before you start shopping.

Yes. You can generally ask to cancel private mortgage insurance once your balance reaches 80% of the home's original value, and federal law requires it to end automatically at 78% if you are current on payments. Lenders may set conditions, such as a good payment history.

The Federal Housing Finance Agency sets the conforming loan limit every year, and it is higher for 2 to 4 unit homes. Above it, the loan becomes a jumbo loan. We confirm the current limit for your county and property type.