Conventional Loan

1% Down Conventional Loan

Our Conventional 1% Down loan is making homeownership more affordable for borrowers. Qualified borrowers only need to put down 1%, and we pay an extra 2% towards the down payment, up to $4,000, for a total of 3% down. It's a win-win for new borrowers.

Plus, you can use gift funds and down payment assistance to cover your entire down payment. It’s a great way to get into your home of your dreams while keeping more money in your pocket.


  • For borrowers with income at or below 80% of the Area Median Income (AMI)
  • Minimum FICO = 620
  • 30-year fixed loans with a loan to value (LTV) of 97%
  • Follows HomeReady and Home Possible guidelines
  • Eligible for primary purchases only
  • Maximum 90-day lock period

Conventional loans are often the most sought after by homebuyers because of their low down payment options, fast closes, and low rates.  

If you are able to make a minimal down payment, have good credit and prove stable income, you may qualify for a CONVENTIONAL LOAN and benefit from (typically) lower rates. Interest rates for conventional loans are credit score-dependent, the higher the credit score the lower the qualifying interest rate. Plan your budget with a consistent mortgage payment at a low rate that will stay the same through the life of your loan.

Common types of fixed rate mortgages

The 15-year fixed rate mortgage

You will pay less in interest. If you borrow $100,000 to purchase a home at a 4% interest rate, paying over a longer period of time will mean more interest on the money borrowed. So, a 15-year mortgage can significantly cut down on the interest that you pay. Add to that the lower interest rates that are often available for 15-year mortgages and you could have some big savings available.

Your monthly payment will likely be higher. Even with the lower interest rate, you will probably have a slightly higher payment with a 15-year mortgage. This happens because you are paying more towards principal from the beginning. But, you will be mortgage-free in half the time, which is no small feat.

The 30-year fixed rate mortgage

You will pay more in interest. Longer mortgage means more interest charged. This is how banks and other lenders make their money. They loan you, the borrower, money and collect their interest over the 15 or 30 years it takes you to pay them back.

Your monthly payment will likely be lower. Because you are spreading out your payments over a longer period of time, they will almost always be lower with a 30-year mortgage. If your monthly budget is tight, this may be a better way to go.

Conventional vs Conforming Loans

  • $766,550 for regular one-unit conventional loans 
  • $1,149,825 for regular one-unit conventional loans in high-cost counties 

The terms “conventional loan” and “conforming loan” are often used interchangeably, but these do not mean the same thing! Conventional is a general category of loan types that includes a variety of products, including conforming loans.

A conforming loan “conforms” to Fannie Mae (Fannie) and Freddie Mac (Freddie) underwriting guidelines and is therefore eligible for purchase by Fannie and Freddie. Fannie and Freddie are the government-sponsored entities set up to create a secondary market for mortgages (outside of banks alone). The majority of all mortgages obtained in the United States are conforming.

Conforming loans must stay within the county’s conforming loan limits set out each year. For most areas in Illinois, Mississippi, Florida, Alabama, Missouri, Tennessee, Arkansas, Michigan,the loan limits range from $766,550. In high-cost counties, the loan limit is $1,149,825. Any loan that exceeds the county loan limit or does not conform to Fannie/Freddie guidelines would be considered conventional “non-conforming” and could include jumbo loans or portfolio products.