To qualify for a conventional loan, borrowers typically need to have good credit, a stable income, and a down payment of at least 3-5% of the purchase price of the home and meet all requirements by Freddie Mac and Fannie Mae and they generally conform to the loan limits set by the Federal Housing Finance Administration (FHFA). However, borrowers who can afford to put down a larger down payment may be able to secure better interest rates and terms.

One of the main benefits of a conventional loan is that there are more options available for borrowers. Conventional loans also offer more flexibility when it comes to loan amounts and property types. For example, borrowers can use conventional loans to purchase a primary residence, a vacation home, or an investment property. For this and other reasons, they are viewed as riskier and thus, have stricter requirements than government loans offered by lenders such as VA, FHA, or USDA.

Overall, conventional loans can be a good option for borrowers who have good credit, a stable income, and a down payment saved up. However, it’s important to shop around and compare rates from different lenders to make sure you’re getting the best deal possible.

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