Conventional Mortgage Loans: Rates, Requirements, & How to Qualify

Get the latest insights on Conventional Mortgage Loans. Learn about down payments, credit score requirements, interest rates, and refinancing options.

Conventional mortgage loans: The ultimate guide for homebuyers

What is a Conventional Mortgage Loan?

A Conventional Mortgage is a type of home loan not insured by a government agency like the FHA, VA, or USDA. They are offered by private lenders and meet the funding criteria set by Fannie Mae and Freddie Mac.

Benefits of conventional loans

Variety in loan terms

Choose from various loan terms, such as 15, 20, or 30 years, depending on your financial goals.

Lower interest rates

Conventional loans often offer lower interest rates than government-backed mortgages, making them cost-effective in the long run.

Flexibility in Down Payment

Conventional loans often allow for a down payment as low as 3%, although a higher down payment may result in better terms.

Requirements for conventional loans

Credit Score

A minimum credit score of 620 is usually required, but a higher score may secure better rates.

Debt-to-Income Ratio

A Debt-to-Income ratio of less than 43% is generally recommended.

Private Mortgage Insurance (PMI)

PMI is typically required if the down payment is less than 20%.

Requirements for conventional loans

Fixed-Rate Mortgage

The interest rate remains constant throughout the loan term.

Adjustable-Rate Mortgage (ARM)

The interest rate can change at predetermined intervals.

How to apply for a conventional loan

Pre approval

Understand how much you can afford.

Loan application

Submit all necessary financial documentation.


The lender will assess the value of the home.

Loan approval

After due diligence, the loan will be approved.


Finalize your mortgage with a closing meeting.