Home Loans
Conventional Loans
Conventional loans are the most widely used mortgage in the country for good reason. No government backing means more flexibility on property types, loan amounts, and terms. If your credit and income are solid, a conventional loan often gives you the most options and the best long-term cost.
3%
Minimum Down Payment
No MIP
At 20% Down
PMI Off
At 20% Equity
What Is a Conventional Loan?
A conventional loan is any mortgage that is not backed by a government agency. That means no FHA, no VA, no USDA. Instead, conventional loans are issued by private lenders and typically sold to Fannie Mae or Freddie Mac on the secondary market. Because there is no government guarantee, lenders apply stricter credit and income standards — but in exchange, borrowers often get better rates, more flexible property options, and the ability to drop mortgage insurance once they hit 20% equity.
Conventional loans come in two main varieties: conforming loans that fall within Fannie Mae and Freddie Mac limits, and non-conforming loans like jumbo products that exceed those limits. For most buyers in Colorado Springs, a conforming conventional loan is the most straightforward and cost-effective path to homeownership.
Ready to Get Started?
Let's Talk About Your Conventional Loan Options
No pressure, no runaround. Just a straight conversation about what you qualify for and what makes the most sense for your situation.
Key Benefits
PMI Is Removable
Unlike FHA mortgage insurance, PMI drops off automatically once you reach 20% equity. You are not stuck with it for life.
More Property Flexibility
Conventional loans work on primary residences, second homes, and investment properties. FHA and VA are limited to primary residences only.
Competitive Rates for Strong Credit
Borrowers with good credit and stable income often get the most favorable rates available compared to any other product.
No Upfront Insurance Premium
Unlike FHA, conventional loans have no upfront mortgage insurance premium. Put 20% down and there is no mortgage insurance at all.
Who Qualifies?
Conventional loans work best for buyers with solid credit, stable income, and enough savings for a down payment. The requirements are stricter than FHA, but the tradeoff is better rates, more property flexibility, and no lifetime mortgage insurance.
General requirements include:
- Credit score of 620 or higher, though 680 or above gets the best rates
- Debt-to-income ratio generally at or below 45%
- Stable employment and income history, typically two years in the same field
- Down payment of 3% to 20% or more depending on the loan program
- The property can be a primary residence, second home, or investment property
- Loan amount within conforming limits for your county
Not sure if conventional is the right fit versus FHA or another product? Todd and Aaron will run the comparison for you and show you exactly which loan makes the most financial sense for your situation.
Good to Know
If your credit score is below 620, conventional financing is not currently available to you. That does not mean you cannot buy -- it may mean FHA is the better starting point while you continue building your profile.
Todd and Aaron will always tell you where you stand and what the smartest path forward looks like.
FHA vs. Conventional
Not Sure
Which One?
Todd and Aaron will run both scenarios side by side so you can see the real numbers and make an informed decision. No guessing, no pressure.
How the Process Works
Review Your Credit and Financial Profile
Todd and Aaron pull your credit and review your income, assets, and debt picture to confirm eligibility and identify the best conventional program for your situation.
Get Pre-Approved
A real pre-approval based on verified income and credit. Not an estimate. Sellers and their agents know the difference, and your letter reflects it.
Find Your Home and Go Under Contract
Shop with a clear budget in mind. Once you are under contract, we get moving immediately to lock your rate and open the file.
Appraisal and Underwriting
A licensed appraiser confirms the home's market value. Underwriting reviews your complete file. Conventional appraisals typically move faster than government-backed ones.
Clear to Close and Get Your Keys
Once underwriting issues the clear to close, we schedule closing and walk you through exactly what to expect. No last-minute surprises, no scrambling.
Typical Timeline
21-30
Days to Close
Conventional loans typically close faster than government-backed products. With everything organized upfront and no agency review required, we can move quickly when the timeline matters.
Worth Knowing
Lock Your Rate Early.
Rate locks on conventional loans are typically available for 30, 45, or 60 days. Todd and Aaron will advise you on the right lock window based on your contract timeline so you are not caught off guard by rate movement.
Common Questions
What is the difference between a conforming and non-conforming conventional loan?
A conforming loan falls within the loan limits set by Fannie Mae and Freddie Mac, which are updated annually. In most of Colorado, the conforming limit for a single-family home is in the mid-700s range. A non-conforming loan — often called a jumbo loan — exceeds those limits and typically carries slightly different qualification requirements and rates.
When does PMI drop off a conventional loan?
PMI is automatically cancelled when your loan balance reaches 78% of the original purchase price based on your scheduled payments. You can also request cancellation once you reach 80% loan-to-value, either through payments or appreciation. Todd and Aaron will flag that milestone for you so you know exactly when to make the call.
Can I use a conventional loan for an investment property?
Yes. Conventional loans are one of the few mortgage products that allow financing on investment properties. You will typically need a higher down payment — usually 15% to 25% depending on the number of units — and your credit and reserves will be scrutinized more closely. Todd and Aaron work with investors regularly and know how to structure these deals correctly.
Is a 15-year conventional loan worth it?
It depends on your goals and cash flow. A 15-year loan builds equity much faster and carries a lower interest rate, but your monthly payment will be significantly higher. If you have the income to handle the payment comfortably, the interest savings over the life of the loan can be substantial. Todd and Aaron will run both scenarios so you can compare real numbers.
Should I go conventional or FHA if I qualify for both?
It depends on your credit score, down payment, and how long you plan to stay in the home. Conventional often wins on total cost if your credit is strong and you have 5% or more to put down, mainly because PMI is removable and there is no upfront insurance premium. FHA can make more sense at lower credit scores or with minimal savings. Todd and Aaron will show you the side-by-side comparison with your actual numbers.
Still Have Questions?
Just Ask. We Pick Up the Phone.
No automated phone trees, no waiting on hold. You get Todd or Aaron directly.
Call Todd: (719) 482-5359 Call Aaron: (404) 455-5710