Conventional Loan and Mortgage Services for Virginia
Previously, getting a conventional mortgage meant making a 20% down payment. Which wasn’t an Ideal situation for first-time home buyers. Recent changes have made things different today; several conventional loan programs that require less money down (e.g. 3% or 5%) and compete directly with traditional low down payment programs like FHA. What’s more, some conventional mortgages are specifically designed for low and moderate-income borrowers.
Conventional loans are mortgages made by private lenders that meet the underwriting requirements of Fannie Mae or Freddie Mac, two of the largest acquirers of mortgages on the secondary market. In fact, nearly 70% of all home loans made in the United States are conventional.
Conventional loans cannot exceed the conforming loan limits set by the FHFA. Loans that exceed the limits are called Jumbo Loans and carry a slightly higher interest rate.
Conforming Loan Limits for the Richmond, Virginia area:
- 1 unit – $647,200
- 2 unit – $828,700
- 3 unit – $1,001,650
- 4 unit – $1,244,850
Credit Score
Conventional programs require a FICO score of 620.
Some programs allow scores as low as 620. Conventional Loans offer up 97% financing with no investor overlay. 1st time home buyer or new purchase in 3 years have options for only 3% down.
Private Mortgage Insurance (PMI)
While conventional loans are available with only 3% to 5% down, putting up less than 20% will require you to carry private mortgage insurance (PMI). Mortgage insurance is a small fee, added to your monthly mortgage payment, which protects lenders should the loan go into default.
Find Your Home
Do you know how the mortgage loan process works? We want you to be educated on the process so you fully understand step by step how we are going to get you in the home of your dreams. We have a unique tool built specifically to help you understand the mortgage loan process from start to finish!