Requirements often include a good credit score (usually 620 or higher), a stable income, a manageable debt-to-income ratio, and a down payment (typically ranging from 3% to 20%).

While down payment requirements can vary, conventional loans may require as little as 3% down for qualified borrowers. However, a 20% down payment often avoids private mortgage insurance (PMI).

• Single-family homes

• Condominiums

• Townhouses

• Duplexes

• Triplexes

• Fourplexes

• Vacation homes (for personal use)

• Investment properties (rental homes or multifamily units)

• Planned unit developments (PUDs)

• Co-operative apartments (co-ops)

Conventional loans often offer the flexibility to finance various property types, making them a versatile choice for different homeownership or investment needs.

Yes, conventional renovation loans are available, allowing borrowers to finance both the purchase price and renovation costs of a property in a single mortgage.

• Fixed-Rate Conventional Loans: These loans feature a consistent interest rate throughout the loan term, ensuring stable monthly payments. Borrowers can choose from various repayment periods, commonly 15 or 30 years, providing flexibility in managing long-term finances.

• Adjustable-Rate Mortgages (ARMs): ARMs offer an initial fixed-rate period followed by a period where the interest rate can fluctuate based on market conditions. Borrowers might benefit from lower initial rates, but these rates can change periodically, potentially affecting monthly payments.

• Conforming Loans: These loans adhere to the maximum loan limits set by Fannie Mae and Freddie Mac. They typically come with competitive interest rates and are suitable for borrowers looking to finance a property within the set loan limits.

• Non-Conforming Loans (Jumbo Loans): Non-conforming loans exceed the maximum loan limits established by Fannie Mae and Freddie Mac. Jumbo loans are often used to finance higher-priced properties, and they usually require higher credit scores, larger down payments, and stricter eligibility criteria.

• Conventional Renovation Loans: These loans, often known as HomeStyle Renovation or CHOICERenovation loans, allow borrowers to finance the purchase price of a home as well as the costs of renovation or improvements. This option can be beneficial for individuals looking to buy a fixer-upper property and finance the necessary renovations.

• Conventional Cash-Out Refinance Loans: These loans enable homeowners to refinance their existing mortgage for an amount higher than their current loan balance. The homeowner receives the difference in cash, which can be used for various purposes, such as home improvements, debt consolidation, or other financial needs.

These variations within conventional loans provide borrowers with diverse options to meet their specific financial goals and circumstances. It's essential to discuss with a mortgage broker or lender to determine which type of conventional loan aligns best with individual needs and preferences.

Typically, yes. Many conventional loans don't have prepayment penalties, allowing borrowers to pay off their loan early without incurring additional fees.