Conventional Mortgage

Requirements may vary from lender to lender but 620 is typically the minimum credit score needed to obtain a conventional loan, and 740 is the minimum (middle) score you need to get a good low interest rate mortgage.  The term ranges from 15, 20, to 30 years.

Conventional loans have a higher bar for approval than other types of loans.  They tend to be good for borrowers with good credit and low debt-to income (DTI) ratio who can make a down payment of 5% – 20%.  Putting 20% down allows you to avoid private mortgage insurance in additional to a low rate.

Another benefit of the conventional loan – even if you do pay private mortgage insurance (PMI) is that it goes away as you accumulate equity and eventually disappears altogether once you have 20% equity.

If you have ever had a bankruptcy you can qualify for a conventional loan with re-established credit and 36 months have passed from the bk discharge date.