01 · Loan program
Conventional.
The default mortgage for buyers with stable income, decent credit, and a documentable down payment. Not backed by a government program — underwritten to Fannie Mae or Freddie Mac standards. It's the most common loan in the country for a reason.
3%
min down payment
620+
credit score
$832k
conforming limit
The down-payment myth
You don’t need 20% down.
Three percent gets you in through HomeReady or Home Possible. You’ll carry PMI until 20% equity — but Conventional PMI is removable, unlike FHA’s lifelong MIP.
3%
minimum down
20%
equity drops PMI
740+
best pricing
· The structure
How it's built
- PMI
- Required when down payment is below 20%. Removable at 20% equity — unlike FHA's MIP, which usually lasts the life of the loan.
- Loan types
- Fixed-rate (10, 15, 20, 25, 30 yr) or adjustable-rate (5/6, 7/6, 10/6 ARM). Fixed is the default; ARMs make sense if you'll move or refi within the fixed period.
- Conforming limit
- $832,750 in most U.S. counties for 2026. Above that, you're in Jumbo territory — different underwriting, often better rates with strong credit.
- Down payment
- 3% minimum via HomeReady or Home Possible programs. 5% is the standard floor. 20% drops PMI from day one.
- Property types
- Primary residence, second home, or investment property. Each tier has its own down payment and reserve requirements.
- Closing timeline
- 25–35 days from application to keys for a clean file. Slower if appraisal or income complications surface.
· What you'll need
Qualifying
- Credit score
- 620 minimum for fixed-rate loans, 640 for ARMs. 740+ is the sweet spot for the best available rates — every 20-point band above 620 typically improves pricing.
- Debt-to-income
- Up to 50% through automated underwriting — which is how nearly every conventional loan is decided today. Manually underwritten files cap at 36%, or 45% with strong credit and reserves.
- Income docs
- Two years of W-2s, last 30 days of pay stubs. Self-employed: two years of personal and business tax returns.
- Reserves
- None required for a single-family primary residence — though the automated underwrite can ask for more on a riskier file. Investment properties: six months of PITI is the working assumption.
- Gift funds
- Allowed for the entire down payment on a primary residence — from relatives by blood, marriage, or adoption, plus domestic partners, fiancé(e)s, and close longstanding relationships. Gift letter and a documented transfer required. Not allowed on investment properties.
- Employment history
- Two years in the same field — not necessarily the same job. Career changes are fine if they're consistent with prior work.
· Straight talk
Not for you if your credit is still rebuilding under 620 — FHA opens nearly the same door at 580, and is built for thinner files.
When a loan I offer isn't right for you, I'll say so — and point you to the one that is.
· Common questions
FAQ
Conventional or FHA — what's the difference?
Conventional needs better credit (620 vs 580) but PMI is removable at 20% equity. FHA's MIP usually stays for the life of the loan. Conventional is cheaper long-term if you qualify.
Do I really need 20% down?
No. You can put down as little as 3%. You'll pay PMI until you hit 20% equity, but Conventional PMI is usually cheaper than FHA's MIP — and it goes away.
How is my interest rate determined?
Credit score, down payment percentage, loan-to-value, debt-to-income, property type, and current market rates. Credit score is usually the single biggest factor.
Can I use gift money for the down payment?
Yes — and it can cover the whole down payment on a primary residence. Eligible donors go beyond blood relatives: domestic partners, a fiancé(e), even a longstanding family-like relationship counts. You'll need a gift letter and a paper trail of the transfer.
What if I'm self-employed?
Conventional is friendly to self-employed borrowers. You'll need two years of tax returns; qualifying income is the lower of the two years (or an average if trending up).
How long does closing take?
Typically 25–35 days from application to keys. Faster on a clean file. Slower if appraisal or income items need a second look.
· Questions left?
Ask me directly.
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