Loan

CONVENTIONAL HOME LOANS

Conventional Loans

The most common type of mortgage loan, conventional home loans, come in a variety of options and offer some excellent advantages for qualified borrowers. 

Benefits of a conventional loan

  • More down payment options than alternative loans, especially for first-time homebuyers
  • Advantages for buyers who put down a bigger down payment
  • Competitive interest rates and flexible repayment terms
  • Allows you to finance properties that are restricted by government loans
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What is a conventional loan?

Conventional home loans are what you probably think about when you hear the word “mortgage.” These loans are called conventional because they’re not part of a specific government program (like VA and FHA loans). Instead, conventional loans are backed by private lenders such as credit unions, banks, and mortgage companies. The beautiful thing about conventional loans is their flexibility. Because there are several different sets of guidelines that fall under the umbrella of “conventional loans,” there’s no single set of requirements for borrowers. For example, you can choose between a fixed-rate or adjustable-rate mortgage. In addition, the maximum loan amount and minimum credit score are determined based on the loan product type. And first-time home buyers, the down payment could be as low as 3% compared to other loans, which require 10-15% down.

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Conventional Loans

The most common type of mortgage loan, conventional home loans, come in a variety of options and offer some excellent advantages for qualified borrowers. 

What is a conventional loan?

Conventional home loans are what you probably think about when you hear the word “mortgage.” These loans are called conventional because they’re not part of a specific government program (like VA and FHA loans). Instead, conventional loans are backed by private lenders such as credit unions, banks, and mortgage companies. The beautiful thing about conventional loans is their flexibility. Because there are several different sets of guidelines that fall under the umbrella of “conventional loans,” there’s no single set of requirements for borrowers. For example, you can choose between a fixed-rate or adjustable-rate mortgage. In addition, the maximum loan amount and minimum credit score are determined based on the loan product type. And first-time home buyers, the down payment could be as low as 3% compared to other loans, which require 10-15% down.

Benefits of a conventional loan

  • More down payment options than alternative loans, especially for first-time homebuyers
  • Advantages for buyers who put down a bigger down payment
  • Competitive interest rates and flexible repayment terms
  • Allows you to finance properties that are restricted by government loans

Is a conventional home loan right for you?

Conventional home loans are generally a great option if you’re a first-time homebuyer or need a wide range of down payment options. Most conventional loans require a credit score of 620 or higher and a relatively low debt-to-income ratio.

Other things to think about when considering a conventional loan:

  • There’s some flexibility in th down payment requirement for a conventional loan, especially if this is your first home.
  • The amount of your down payment will have a direct impact on the amount of mortgage insurance you pay, so more down is generally better.
  • Individuals who have filed for bankruptcy or had a foreclosure within the past seven years may not qualify for a conventional loan. If this special circumstance applies to you, get in touch and the Hixon team can help you look at all of your options! 

Personalized Lending in the PNW

If you don’t meet the requirements for a conventional loan, don’t worry! Hixon’s loan officers are here to discuss your unique financial situation. We can help determine whether a conventional loan is right for you or if another loan program may be a better fit.

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Derek Meyer

VP of Mortgage Lending

NLMS: 1457587

541-280-5785Email Derek
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Brian Liebman

VP of Mortgage Lending, Producing Manager

NLMS: 249643

541-610-2275Email Brian
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Retta Wilson

Branch Manager - Lake Oswego

NLMS: 252865

Cell: 360-605-7480Retta.wilson@hixonmortgage.com