A conventional loan is any type of mortgage loan that is not offered or secured by the federal government. Conventional mortgages are typically available through private lenders such as banks, credit unions, mortgage lending companies and other financial institutions. Conventional loans typically require a minimum of a 620 credit score but it depends on the lender. When it comes to conventional loans, your credit history is important and may affect your interest rate. The better your credit is, the less you will pay in interest throughout the life of your loan. A down payment between 3%-20% is required for conventional loans. If you put down less than 20% on a conventional mortgage, the lender typically requires you to temporarily pay private mortgage insurance (PMI) as part of your monthly payment.
