Learn · loan programs
Conventional loans
Loans that follow Fannie Mae or Freddie Mac rules, including 3%-down options for lower-income buyers.
What it is
A conventional loan isn’t insured by a government agency. Most follow Fannie Mae or Freddie Mac guidelines, which cap the loan size each year. For 2026, the one-unit conforming limit in Broward, Palm Beach and Miami-Dade is $832,750.
Who it fits
- Buyers with steady income and established credit
- Buyers who can put down 3% or more (more choices open up at 5%, 10% and 20%)
- Buyers of primary homes, second homes and investment properties
How it works
- Fannie Mae’s HomeReady and Freddie Mac’s Home Possible allow as little as 3% down when total qualifying income is at or below 80% of the area median income for the property’s location.
- With less than 20% down, you’ll usually pay private mortgage insurance (PMI). Freddie Mac notes Home Possible borrowers can ask to cancel it once they reach 20% equity.
- For manually underwritten fixed-rate loans, Fannie Mae’s minimum credit score is 620. Loans run through Fannie Mae’s automated system (DU) have no set minimum; DU weighs the whole file.
Benefits
- Mortgage insurance that can come off later
- Flexible on property types (including approved condos)
- HomeReady and Home Possible allow gifts and grants for the down payment
Tradeoffs
- Pricing is more sensitive to credit score and down payment
- Condo buildings must pass the lender’s project review
- Loan size is capped by the conforming limit
Typical documents
- Recent pay stubs and W-2s (or tax returns if self-employed)
- Two recent months of bank and asset statements
- Photo ID and Social Security number
- Gift letter if family is helping
Your lender may ask for more or less. Full list: 1-page document checklist (PDF).
Common myth: “You need 20% down for a conventional loan.” Not true: HomeReady and Home Possible start at 3% down for income-eligible buyers, and other conventional loans allow less than 20% with mortgage insurance.
Pairing with assistance? See the down payment assistance finder.
Last checked October 17, 2026. Sources: Fannie Mae, HomeReady mortgage · Fannie Mae Selling Guide B5-6-01, HomeReady eligibility · Freddie Mac, Home Possible · Freddie Mac My Home, 3% down with Home Possible · Fannie Mae Selling Guide B3-5.1-01, credit scores · FHFA, Conforming Loan Limit Values for 2026
Availability depends on the lender and program funding; ask me which ones I can use for your loan.
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