How it works
A conventional loan follows guidelines set by Fannie Mae and Freddie Mac. Because it isn't government-insured, there's no upfront government funding fee, and if you put less than 20% down, the private mortgage insurance (PMI) can typically be removed once you build enough equity.
May be a good fit for
- Buyers with fair-to-strong credit (many programs start around 620)
- First-time buyers who may qualify for as little as 3% down
- Buyers putting 20% or more down who want to skip mortgage insurance
- Second homes and investment properties
Good to know
- With less than 20% down you'll typically pay PMI. You can generally request removal once your balance reaches 80% of the home's original value, and it usually ends automatically at 78% if you're current
- Loan amounts are capped at the conforming loan limit; above that is a jumbo loan
- Credit score and down payment both affect pricing, so small changes can matter
- Gift funds from family can often be used toward the down payment
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This page is general information, not a commitment to lend or a loan approval. Programs, guidelines, fees and availability can change and depend on your credit, income, assets, property and full underwriting. Not all applicants will qualify.