Conventional Loans
With our conventional loan programs, you’ll benefit from competitive rates, flexible terms, and minimal costs perfect for primary residences, second homes, or investment properties. We work with top lenders to help you qualify with as little as 3–5% down, depending on your credit and loan type.
Conventional Loans A Reliable Path to Homeownership
At Richmond Mortgages, we understand that choosing the right mortgage is one of the most important financial decisions you’ll make. Among the various options available, Conventional Loans remain one of the most popular and trusted choices for homebuyers in Virginia and beyond. Whether you’re a first-time buyer or looking to refinance, understanding how conventional loans work can help you make an informed, confident choice.
What is a Conventional Loan?
Conventional loans are home mortgages that are not backed by a government agency, such as the Federal Housing Administration (FHA), Veterans Affairs (VA), or the U.S. Department of Agriculture (USDA). Instead, these loans are typically offered by private lenders such as banks, credit unions, and mortgage companies and follow guidelines set by Fannie Mae and Freddie Mac, two government-sponsored enterprises.
Since they’re not government-insured, lenders assume more risk with conventional loans, which is why borrowers typically need to meet stricter qualification requirements compared to government-backed mortgages.
Key Benefits of Conventional Loans
Choosing a conventional loan comes with several advantages, especially for borrowers with strong credit and stable income.
Lower Overall Costs Over Time
Unlike FHA loans, conventional loans do not require upfront mortgage insurance premiums (MIP). If you put down at least 20%, you can avoid private mortgage insurance (PMI) altogether, reducing your monthly payment and long-term costs.
Flexible Loan Terms
Conventional loans offer a range of fixed-rate and adjustable-rate terms. You can select a mortgage term that fits your financial goals
most commonly 15, 20, or 30 years.
Competitive Interest Rates
Borrowers with higher credit scores and solid financial histories can secure very competitive interest rates on conventional loans.
Wide Range of Property Types
Conventional loans can be used to finance a primary residence, second home, or even an investment property, making them more flexible than many government-backed loans.
Conventional Loan Requirements
While conventional loans offer flexibility and long-term savings, they do come with specific borrower qualifications.
Credit Score
A minimum credit score of 620 is usually required, though a higher score can help you lock in better interest rates.
Down Payment
You’ll need to put down at least 3%–5% of the purchase price. However, a 20% down payment will allow you to skip PMI, making the loan more affordable in the long run.
Debt-to-Income Ratio (DTI)
Most lenders prefer a DTI ratio of 43% or less, ensuring that you can comfortably manage your monthly mortgage payment along with your other debts.
Stable Income & Employment
Lenders will verify employment history, income level, and assets to ensure your ability to repay the loan.
Types of Conventional Loans
There are two main categories of conventional loans, both of which are offered at Richmond Mortgages:
1. Conforming Loans
These loans meet the loan limits and guidelines set by Fannie Mae and Freddie Mac. As of 2025, the conforming loan limit in most U.S. counties is $766,550. These loans typically offer the lowest rates and best terms.
2. Non-Conforming (Jumbo) Loans
If the loan amount exceeds the conforming loan limit, it becomes a jumbo loan. These loans are ideal for high-value property purchases but usually come with stricter credit and income requirements.
Who Should Consider a Conventional Loan?
Conventional loans are ideal for:
Buyers with strong credit and stable income Individuals who can afford a larger down payment Homeowners looking to avoid mortgage insurance Buyers interested in investment properties or vacation homes
Why Choose Richmond Mortgages?
At Richmond Mortgages, we go beyond just offering mortgage products—we provide guidance, support, and customized solutions. Our team of mortgage experts will work with you to determine if a conventional loan is the right fit based on your budget, goals, and homeownership plans.
Whether you’re buying your first home in Richmond, refinancing an existing loan, or investing in property, we make the process clear, fast, and stress-free. Our local market expertise ensures you get the best deal and the most reliable service every step of the way.
Start Your Journey Today
A conventional loan might just be your key to affordable, long-term homeownership. If you’re ready to explore your options, contact Richmond Mortgages today. Our licensed mortgage professionals are here to answer your questions and guide you through the approval process with honesty and integrity.
Final Thoughts
Conventional loans offer unmatched flexibility, especially for borrowers with strong financial profiles. With the right lender by your side, navigating the process becomes far less intimidating. At Richmond Mortgages, we’re proud to help families across Virginia find the perfect financing solution for their dream homes.
FAQs About Conventional Loans
Ans: The main difference lies in the insurance and qualification requirements. FHA loans are government-insured and typically allow for lower credit scores and smaller down payments. Conventional loans are not government-backed and usually require higher credit scores but offer better interest rates and no upfront mortgage insurance.
Ans: No. While putting down 20% allows you to avoid Private Mortgage Insurance (PMI), many lenders offer conventional loans with down payments as low as 3% to 5%, depending on your credit score and income.
Ans: Most lenders require a minimum credit score of 620, but a score of 740 or higher can help you qualify for the best rates and terms.
Ans: Yes. One of the biggest advantages of conventional loans is that they can be used to purchase primary residences, second homes, and investment properties—unlike many government-backed loans that are limited to primary residences.
Ans: PMI (Private Mortgage Insurance) is required if your down payment is less than 20%. However, once you reach 20% equity in your home, you can request to remove the PMI—making conventional loans more cost-effective in the long term.
Ans: The timeline varies by lender, but at Richmond Mortgages, we aim to complete the approval process in as little as 2 to 3 weeks, depending on how quickly you provide the required documentation.
Ans: Yes, refinancing into a conventional loan is a smart move if you’re looking to reduce your monthly payment, drop mortgage insurance, or secure a lower interest rate—especially if your credit score or home equity has improved.
How It Works
Let us help you get your home today
Step 1
Low Down Payment Options
Conventional loans offer down payments as low as 3%, making homeownership more accessible especially for first-time buyers.
Step 2
Competitive Interest Rates
Enjoy fixed or adjustable-rate options with low interest, helping you save more over the life of your loan.
Step 3
No Upfront Mortgage Insurance
Unlike FHA loans, many conventional options don’t require upfront mortgage insurance premiums—reducing your initial costs.
Step 4
Flexible Terms & Loan Amounts
Choose from a variety of term lengths and borrow up to the conforming loan limit—or go higher with jumbo options.