If you have a solid credit standing (score of 620 or higher), a debt-to-income ratio of 43% or less and a large amount of money saved up for a down payment (anywhere from 5-20% or more), a conventional loan could be a great option for you! Conventional mortgages are offered through private lenders, and unlike some other options like FHA and VA loans, aren’t backed by any government entities. What does this mean for you? Basically, since no one is guaranteeing the funds you’re borrowing, lenders want to be confident in your financial standing and ability to pay them back.
If you’re not sure whether a conventional loan is a good fit for you, talking through options with a lender is a great next step. And, stay tuned for future articles where we’ll dig into the details of FHA and VA loans!