If you are buying your first home, moving into a larger property, or refinancing an existing mortgage, a conventional loan may fit your plans. We help Arizona borrowers compare conventional financing through multiple wholesale lenders. We shop available rates, closing costs, and program requirements to help you choose financing that fits your qualifications and budget.
What Is a Conventional Mortgage?
A conventional mortgage is a home loan that is not insured or guaranteed by a government agency such as FHA, VA, or USDA. Many conventional loans follow Fannie Mae or Freddie Mac guidelines. These programs offer purchase and refinance options for eligible borrowers and properties, with requirements based on occupancy, down payment, credit, income, and loan amount.
Conventional Loan Options
- Home purchase financing
- Rate-and-term refinancing
- Cash-out refinancing
- Fixed-rate mortgages
- Adjustable-rate mortgages
- Primary residences
- Second homes
- Investment properties
- Eligible low-down-payment programs
- High-balance financing where applicable
Buying a Home in Arizona
A conventional purchase loan can help finance a home in an established neighborhood, a growing suburban community, or an eligible rural location. You don’t need a 20% down payment for every conventional mortgage. Eligible low-down-payment options may be available, although mortgage insurance and other requirements can apply.
Low-Down-Payment Financing
Some conventional programs allow as little as a 3% down payment for qualifying primary residence purchases. Eligibility depends on the selected program. First-time homebuyer status, income limits, homebuyer education, property type, and underwriting requirements may affect which option is available. We can compare eligible low-down-payment programs with other conventional structures to help you understand the costs and requirements.
Understanding Private Mortgage Insurance
Private mortgage insurance, or PMI, is generally required on conventional purchase loans with less than 20% down. PMI protects the lender, but its cost affects your payment. The amount depends on factors such as credit, loan-to-value ratio, and coverage requirements. Conventional PMI may be eligible for cancellation when you meet certain conditions. That makes the mortgage insurance structure an important part of your comparison.
Fixed-Rate Mortgages
A fixed-rate mortgage keeps the same interest rate for the life of the loan. This provides a consistent scheduled principal-and-interest payment. Your total monthly payment can still change if property taxes, insurance, or other housing expenses change.
Adjustable-Rate Mortgages
An adjustable-rate mortgage, or ARM, typically starts with a fixed-rate period before the rate adjusts according to the loan agreement. An ARM may be worth considering when it aligns with your ownership plans and ability to manage future payment changes.
Conventional Refinancing
- Obtain a different interest rate.
- Change the repayment term.
- Replace an adjustable-rate mortgage.
- Evaluate financing without mortgage insurance when sufficient equity is available.
- Access equity through an eligible cash-out refinance.
Second Homes and Investment Properties
Conventional financing also offers options beyond your primary residence. A qualifying second home must meet the lender’s occupancy and property requirements. We evaluate investment financing separately and may require a larger down payment, additional reserves, or different pricing. For rental properties, eligible rental income may help with qualification when properly documented and accepted under the selected program.
Property Types We Can Review
- Single-family homes.
- Townhomes.
- Condominiums, including non-warrantable condos
- Planned unit developments.
- Two- to four-unit residential properties.
- Manufactured homes under applicable programs.
How Conventional Qualification Works
- Credit history and payment patterns
- Qualifying income and employment
- Monthly debts and housing expenses
- Down payment or available equity
- Assets and any required reserves
- Property value, condition, and eligibility
Self-employed borrowers can also qualify for conventional financing. Their income review generally includes business and tax documentation, as required by the applicable guidelines. If conventional income documentation does not support your request, we can also explore whether a Non-QM alternative is appropriate.
Arizona Conventional Loan Limits
Conforming loan limits are updated annually and depend on the property’s county and number of units. High-balance financing is available only in qualifying areas. We can confirm the applicable limit for your Arizona property. If the requested amount exceeds that limit, jumbo financing may be an option.
Explore Conventional Home Loans Throughout Arizona
If you are preparing to purchase or considering a refinance, start by reviewing your goals and qualifications.