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Family at Home

Conventional Loan

Conventional loans, which are not backed by the federal government like FHA or USDA loans, are the most widely preferred loan type. Private lenders such as banks or mortgage companies, like Vizion Mortgage, offer conventional loans. These loans are typically suitable for borrowers with good credit and sufficient funds for a down payment.

Why a Conventional Loan?

Immediate Equity

While a conventional loan can be obtained with as little as a 3% down payment, it is common for borrowers to put 20% down, resulting in immediate equity in their home upon signing at the closing table. This equity proves advantageous in the long run, benefiting homeowners when they choose to refinance or sell their property.

Faster Closing

Compared to government-backed loans, conventional loans have a simpler and more streamlined underwriting process, resulting in a faster closing. With fewer requirements to meet, borrowers can experience a quicker loan approval and closing time. At Vizion Mortgage, the average closing time for a conventional loan is approximately 17 days, providing a swift and efficient lending experience.

No Mortgage Insurance

A down payment of 20% or more on your home with a conventional loan eliminates the need for mortgage insurance. However, if you put down less than 20%, you will be required to pay mortgage insurance until your loan-to-value ratio reaches 78%. This occurs when you have paid down your loan balance to 78% of the home's value.

Fixed Rate or ARM Rate

Sellers generally find conventional loans more appealing because they indicate strong financial stability on the part of the borrower. Due to the simpler process involved, sellers often prefer borrowers with conventional loans over those with government loans. This preference is based on the streamlined nature of conventional loans, which can lead to a smoother and more efficient transaction for both parties involved in the home sale.

Steps to a Conventional Loan:

01  Get Pre-Approved.

Our online application can help you receive your pre-approval letter quickly. Plus, you can upload all required documents straight into the app to save you time and energy.
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