The Standard Path to Homeownership, Done Right
Not backed by a government agency, and often the most flexible and cost-effective option for buyers with solid credit and a reasonable down payment.
A Conventional Loan, Explained Simply
A conventional mortgage is a home loan that isn't insured or guaranteed by a government agency like the FHA or VA. Instead, it typically follows guidelines set by Fannie Mae and Freddie Mac, the two entities that buy and standardize most conventional loans in the U.S. Because there's no government backing, conventional loans generally require a bit more in credit and down payment than FHA loans, but they come with more flexibility and, once you've built enough equity, no permanent mortgage insurance.
Why Buyers Choose Conventional
PMI Drops Off Automatically
Once you reach 20% equity, private mortgage insurance can be removed, unlike FHA's mortgage insurance, which in most cases lasts for the life of the loan.
Down Payments as Low as 3%
Programs like HomeReady and Home Possible allow qualified buyers to put down far less than the 20% most people assume is required.
Flexible Property Types
Primary residences, second homes, and investment properties are all eligible, unlike FHA and VA loans, which are generally limited to primary residences.
No Upfront Mortgage Insurance Premium
Unlike FHA, there's no 1.75% upfront MIP added to your loan balance at closing.
Competitive Rates for Strong Credit
Buyers with higher credit scores are often rewarded with better pricing than they'd get on an FHA loan with the same score.
Fixed or Adjustable Options
Choose a rate that's fixed for the life of the loan, or an adjustable-rate structure if you expect to move or refinance within a few years.
What It Generally Takes to Qualify
Every file is different, but these are the general benchmarks most conventional loans are measured against.
Typical minimum credit score
Down payment range
Maximum debt-to-income, typically
Typical employment history reviewed
What Buyers Ask Most
Do I need 20% down?
No. That's a common myth. Many conventional programs allow as little as 3–5% down; you'll simply carry PMI until you reach 20% equity.
How is this different from FHA?
Conventional loans generally require stronger credit but offer more flexibility on property type, and PMI can be removed once you build enough equity — FHA mortgage insurance typically cannot.
Can I use a conventional loan for an investment property?
Yes, with a larger down payment and slightly different qualifying guidelines than a primary residence.
What credit score do I actually need?
620 is a common minimum, but your rate and terms improve meaningfully as your score climbs, especially above 740.
Let's See What You Qualify For
No cost, no obligation — a straightforward look at your numbers.
We've been helping people like you achieve their dream of homeownership for over 10 years.
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United Lending Team DBA Clearview Equity Advisors
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Troy, MI 48084
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