Conventional Home Loans with Flexible, Low Down Payment Options
Conventional loans offer flexibility, competitive rates, and down payment options as low as 3% for qualified buyers. We help you understand how conventional financing works, whether it’s the right fit for your situation, and how to maximize your buying power. Our goal is to help you secure a loan that supports both your home purchase and your long-term financial comfort.
Let’s see if a conventional loan is right for you.
Don’t have a big down payment?
Purchase your home with 1% down.
With our Conventional 1% down loans, you put 1% down, and your lender pays an additional 2%, giving you a total of 3% down at closing.
Plus, you can use gift funds and down payment assistance to cover your entire down payment. It’s a great way to get into your "home of your dreams" while keeping more money in your pocket.
What Is a Conventional Loan?
A conventional loan is a mortgage not backed by government agencies like FHA or VA; instead, it’s issued and guaranteed by private lenders or government-sponsored enterprises such as Fannie Mae or Freddie Mac. These loans offer flexibility in down payments, terms, and usage—including financing for primary residences, second homes, and investment properties.
Conforming vs. Nonconforming
- Conforming Loans meet criteria (like credit and loan amounts) set by Fannie Mae/Freddie Mac. Loan limits depend on your area, but for most U.S. regions, a single-family conforming loan cap is around $766,500 in recent years.
- Nonconforming/Non-QM Loans include jumbo mortgages or loans for borrowers with unique financial situations—they may offer flexibility but often come with stricter terms or higher rates.
Why Choose a Conventional Loan?
Pros
- Lower Down Payments: You can get started with as little as 3% down for qualified borrowers.
- Cancellable Private Mortgage Insurance (PMI): Unlike FHA loans where PMI may last the life of the loan, with a conventional loan, PMI typically ends once you’ve built 20% equity.
- More Flexibility: Conventional loans allow a wider range of property types and investment scenarios—from primary residences to rentals.
- Higher Loan Limits: Ideal for those purchasing in higher-cost markets or seeking larger amounts—especially with strong credit.
Considerations
- Credit Score Requirements: Typically, you’ll need a score of at least 620; aim for 780+ to access the lowest rates.
- Higher Down Payment than FHA: Down payments may range from 5%–20% depending on program and credit profile.
- PMI Costs: Required for down payments under 20%, with rates ranging from 0.14% to 2.24%, but removable later.
Types of Conventional Loan Terms
- 30-Year Fixed: Offers stable payments over a long term—most common and predictable
- 15-Year (or 20-Year) Fixed: Higher monthly payments but significantly lower interest over time and faster equity building
- Adjustable-Rate Mortgages (ARMs): Feature lower initial rates, ideal if you plan to sell or refinance within a few years. After the fixed period ends, rates adjust with market changes
Why Choose SimplyHome Funding for Your Conventional Loan?
- Expert Guidance: Marcy and Matt—award-winning, top-tier loan originators—offer trustworthy advice and clarity.
- Tailored Solutions: We’ll walk you through 30-year vs. 15-year vs. ARM options, personalizing your path based on your goals.
- Transparent Support: Clear breakdowns, no surprise fees, and PMI strategies designed to maximize long-term savings.
- Local & Personalized: Serving Arizona and Michigan, our team understands your local market and supports your journey every step of the way.