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Conventional Loans
Find the Best Rate When 100 Lenders Are Competing for Your Mortgage.
INTRODUCTION
What Is a Conventional Loan?
A conventional loan in Virginia is a mortgage not backed by a government agency. Unlike FHA, VA, or USDA loans, conventional loans follow guidelines set by Fannie Mae and Freddie Mac. They are the most widely used home loan in the United States, and one of the benefits of conventional loan programs is that down payments start at just 3%. The minimum credit score on most programs is 620. PMI is required below 20% down and cancels at 78% LTV automatically.
You have been on Zillow for months. You know what you want. What you do not know is whether the rate your bank quoted you is actually the best one availabl.Here is what most homebuyers never find out: the conventional loan rate you receive depends almost entirely on which lender you use. Your bank has one rate. Access Financial, as a mortgage broker with access to 100+ institutional lenders, has the entire market. On a $400,000 loan, a 0.25% rate difference costs you $21,600 over 30 years.
This guide covers conventional loan requirements, 2026 loan limits, down payment options, PMI rules, and how the lender you choose changes the number on your mortgage statement every month for the next 30 years. Many buyers also want to know the difference between FHA and conventional financing, or the VA loan vs conventional loan decision, before they lock in a program, so we cover both comparisons below.
Conventional loans come in two categories. A conforming loan vs conventional distinction matters here: conforming loans sit at or below the Fannie Mae and Freddie Mac annual limits, while nonconforming loans exceed those limits and are called jumbo loans. This is sometimes described as a conforming conventional loan, since every conforming loan is still a conventional loan by definition. This page covers conforming conventional loans.
CONVENTIONAL LOAN REQUIREMENTS 2026
Conventional Loan Requirements for 2026
What do I need to qualify for a conventional loan in 2026?
To qualify for a conventional loan with a 620 credit score in 2026, you need a debt-to-income ratio (DTI) at or below 45 to 50%, documented income through W2s or tax returns, and a down payment of at least 3%. The credit score for conventional mortgage approval works on a tier system, and the best rates go to borrowers with a 720+ score and 20% down. Access Financial shops your file across 100+ lenders to find the one whose guidelines best fit your profile.
What do I need to qualify for a conventional loan in 2026?
Credit Score | Loan Eligibility |
Excellent | Access to the best mortgage options. |
Very Good | Strong mortgage choices with great benefits. |
Good | Standard mortgage options available. |
Fair | Limited mortgage options may apply. |
Needs Improvement | Basic mortgage options may be available. |
2026 Conforming Loan Limits
What is the conventional loan limit for 2026?
The standard conforming loan vs conventional loan limit for 2026 is $806,500 for a single-family home in most US counties. In high-cost areas including Northern Virginia, DC Metro, and most of California, the limit rises to $1,209,750. Loans above these limits are jumbo loans and follow different underwriting guidelines through portfolio lenders. Buyers looking at a conventional loan on mobile home properties should note that manufactured housing often falls under separate guidelines, so confirm eligibility with your loan officer before applying. A conventional loan for a second home purchase also follows conforming limits, though pricing adjustments typically apply.
Property Type | Financing Options |
Single Family Home | Ideal for individual homeowners. |
Duplex | Great for buyers seeking multi-unit living. |
Triplex | Suitable for larger residential investments. |
Fourplex | Best for maximizing rental and investment potential. |
Conventional Loan Down Payment
What is the minimum down payment for a conventional loan?
The minimum down payment for a conventional loan is 3% through Fannie Mae’s Conventional 97 or Freddie Mac’s Home Possible program. A 5% down payment is available to all buyers. PMI is required below 20% down and cancels automatically when the loan reaches 78% LTV under federal law. Unlike FHA mortgage insurance, conventional PMI does not stay for the life of the loan. Buyers coming out of hardship should know that a conventional loan after foreclosure is possible once the required waiting period has passed, and a standard home inspection for conventional loan approval is recommended, though it is not always mandatory the way an appraisal is.
What do I need to qualify for a conventional loan in 2026?
Down Payment Option | Best For |
Minimum | First-time homebuyers. |
Low | Buyers looking for flexible financing. |
Standard | Buyers with more savings. |
Higher | Buyers seeking the best long-term value. |
THE 3 QUESTIONS CONVENTIONAL BUYERS ASK MOST
When comparing conventional vs FHA loans, conventional beats FHA for most borrowers with a 620+ credit score because conventional PMI cancels at 80% LTV while FHA mortgage insurance stays for the life of the loan when the down payment is below 10%. Looking at the difference between FHA loan and conventional loan programs, that PMI difference can cost $20,000 or more over the loan term. FHA wins when your credit score is below 660, or your DTI is above 45%, so the FHA loan vs conventional loan pros and cons really come down to your credit profile and how long you plan to keep the loan. For a full breakdown of conventional loan vs FHA eligibility, or to compare FHA versus conventional loan which is better for your specific file, Access Financial can run both scenarios side by side. Whether you call it a conventional loan or FHA, FHA loan versus conventional, or simply what’s the difference between FHA and conventional, the answer depends on your down payment size and how long you plan to stay in the home.
A VA loan vs conventional loan comparison depends heavily on whether you have VA eligibility. The main benefits of a VA loan vs. a conventional program are no down payment requirement and no monthly mortgage insurance, which usually makes a VA home loan vs. a conventional loan the stronger choice for eligible veterans with limited savings. That said, a VA vs conventional loan decision can favor conventional financing for buyers with strong credit and 20% down, since conventional loans avoid the VA funding fee entirely. Homeowners already in a VA loan sometimes ask about a refinance VA to conventional loan path, or want to know how to refinance VA to conventional financing to drop mortgage insurance requirements or convert a primary residence into a rental. A can you refinance VA loan to conventional question comes up often once equity builds, and a VA vs conventional refinance review can confirm whether the switch actually lowers your monthly payment.
Pre-approval at Access Financial takes 24 hours for qualified borrowers who submit complete documents. Full loan approval from signed purchase contract through appraisal, underwriting, and closing typically takes 30 to 45 days. Access Financial orders appraisals on day one of the contract and tracks files daily to protect your close timeline. If you are weighing a refinance FHA loan to a conventional option or want to refinance an FHA loan to conventional loan terms to remove FHA mortgage insurance for good, our refinance programs follow the same fast timeline.
Why Your Lender Choice Matters More Than You Think
Conventional loans represent approximately 70% of all US mortgage originations, according to the Urban Institute Housing Finance Policy Center 2024 report. The average conventional borrower has a credit score of 755 and a down payment of 19%. Yet CFPB research shows that borrowers who received only one rate quote paid an above market rate on over 30% of transactions. A single additional lender comparison saved the average borrower $1,500 over the loan life. Getting five quotes saved $3,000 or more.
Of all US mortgages are conventional loans
30-year cost of accepting a 0.25% above-market rate on a $400,000 loan
Savings from getting 5 rate quotes vs 1 —