Conventional Loans


Conventional loans are most advantageous for homebuyers with good credit scores and money in the bank for a down payment. Our mortgage team at Supreme Lending assists qualifying homebuyers with securing Conventional loans to purchase a home in the Allen, Texas, area.

Most homebuyers who qualify for a Conventional loan have a credit score of at least 620. Those with lower credit scores may qualify for an FHA loan or other type of government-backed loan program which allow mortgage companies to take on more risk when lending to those with less-than-perfect credit scores.

For down payments, homebuyers eligible for an FHA loan must put down at least 3.5%, but with a Conventional loan, that requirement can be as low as 3%.

FHA loans require homebuyers to pay mortgage insurance for the life of the loan if they put less than 10% down. With a Conventional loan, private mortgage insurance (PMI) is required if the homebuyer puts down less than 20%, but this insurance can be canceled once 20% equity in the home is reached.

Another factor a lender looks at with a Conventional Loan is your debt-to-income (DTI) ratio. Your DTI ratio compares how much you owe each month to how much you earn. When it comes to applying for a mortgage, your DTI helps determine how much you can afford to borrow. Different loan programs can require different DTI ratios, and some programs may even exclude certain debt, like student loans, from a homebuyer’s DTI ratio if they are employed in certain professions.

If you’re in the market for a mortgage loan in Allen, Texas, and you have a good credit score, cash for a down payment, and a debt-to-income ratio of less than 50%, talk to the mortgage lenders at Supreme Lending. We can help you find the right Conventional home loan for you in Allen.