Conventional Loans

Who it's great for

Buyers with solid credit (typically 620+), steady income, and a manageable debt-to-income ratio. It's also the go-to for borrowers who want to avoid the upfront and ongoing mortgage insurance premiums attached to FHA loans.

Down payment

As little as 3% down for first-time buyers (Fannie Mae HomeReady / Freddie Mac Home Possible), 5% for most repeat buyers, and 20%+ to avoid private mortgage insurance (PMI) entirely. Gift funds from family are allowed for the full down payment on a primary residence.

Loan limits in North Carolina

Conforming limits cap most NC counties around the national baseline. Loans above that limit move into jumbo territory and follow different guidelines. I'll confirm the exact limit for your county at application.

Key advantages

• PMI drops off automatically once you reach 22% equity
• Flexible property types — primary, second home, or investment
• Often the lowest total cost for well-qualified borrowers
• Fixed (15, 20, 30-year) or adjustable-rate options
• No upfront mortgage insurance premium (unlike FHA)

Eligible property types

Conventional financing is the most flexible program when it comes to property type. Down payment minimums, reserves, and pricing vary by occupancy and property — I'll walk you through what applies to your scenario.

• Single-family homes — primary, second home, or investment.
• Townhomes — treated like single-family in most cases.
• Condominiums — subject to project review (warrantable vs. non-warrantable).
• 2–4 unit properties — owner-occupied or investment; rental income can help you qualify.
• Planned Unit Developments (PUDs) — common in newer NC subdivisions.
• Manufactured homes — eligible when permanently affixed and titled as real property (Fannie Mae MH Advantage available).
• Second homes — typically 10% down minimum; must be a reasonable distance from your primary.
• Investment properties — typically 15–25% down depending on units and credit profile.

Not eligible: working farms, mixed-use commercial properties, log homes in some markets, and certain unique or non-conforming structures. If you're unsure, send me the listing and I'll tell you what we're looking at.

Worth knowing

Credit score and down payment have a bigger impact on your rate with conventional than with FHA. If your credit is on the edge, it's worth running both scenarios side-by-side — that's something I do for every client before recommending a path.