Loan Programs · Conventional Loan
The Standard Option
For buyers with solid credit and some savings. Usually the lowest-cost choice if you qualify.
Written by the East Coast Mortgage team
A conventional loan isn't backed by a government agency like the VA or FHA. It's the most common type of mortgage, and for buyers with solid credit and a reasonable down payment, it's usually the lowest-cost option overall.
Down payment requirements vary by program, and some conventional programs are designed for smaller down payments. A larger down payment can let you avoid private mortgage insurance (PMI) entirely. With a smaller one, PMI applies, but unlike FHA's mortgage insurance, it typically cancels automatically once you've built enough equity. Fannie Mae and Freddie Mac publish the guidelines (linked below).
Conventional loans come in fixed-rate and adjustable-rate versions, with a range of loan terms. Because there's no single government agency setting the rules, lenders have more flexibility, which is exactly the kind of flexibility we use when shopping your file across our network.
Curious what a conventional loan would actually cost you? Run the numbers, no commitment. Or see why shopping it through a broker beats walking into one bank.
Still deciding between programs?
General information, not a commitment to lend. Rates, terms, and eligibility vary by lender and are subject to underwriting guidelines. Equal Housing Lender, NMLS #2354674.
How Conventional compares
Side by side with the other programs most buyers choose between.
| Compare | VA | FHA | Conventional | USDA |
|---|---|---|---|---|
| Down payment | May not be required for eligible borrowers | Designed for smaller down payments | Varies by program, some allow smaller down payments | May not be required in eligible areas |
| Monthly mortgage insurance | None | Yes (MIP) | Until you build enough equity (PMI) | Annual guarantee fee, lower than PMI |
| Credit flexibility | Flexible | Most flexible | Solid credit gets the best terms | Flexible |
| Where the home can be | Anywhere | Anywhere | Anywhere | Eligible rural and suburban areas |
| Built for | Veterans, active duty, some spouses | First-time buyers, lower scores | Buyers with good credit and some savings | Buyers outside big city limits |
General program guidelines only. Your actual terms depend on the lender, your credit, and the property. Not a commitment to lend.
Common questions
Do I need a large down payment for a conventional loan?
Not always, that's a common myth. Some conventional programs are designed for smaller down payments, you'll just carry mortgage insurance until you build enough equity.
Fixed or adjustable rate, which is better?
It depends on how long you plan to stay in the home and your comfort with rate changes. We'll walk through both with your real numbers.
Popular with everyday buyers
Other programs in the same lane. All 23 →
Sources
- CFPB: Conventional loans
- CFPB: What is private mortgage insurance?
- FHFA: Conforming loan limit values
- Fannie Mae: Single-Family Selling Guide
General information, not advice for your specific situation. Program rules come from the agencies above and from each lender, and they change. A licensed loan officer confirms what applies to you.
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NMLS #2354674 · Equal Housing Opportunity · Not a commitment to lend