Conventional Loans
Conventional Loans for Arizona Homebuyers
Competitive rates, flexible terms, and the ability to drop PMI once you build equity. Conventional loans are a strong choice for qualified buyers.
What Is a Conventional Loan?
Arizona’s Most Common Type of Mortgage
A conventional mortgage is a home loan that isn’t backed by a government agency such as FHA or VA. These loans are offered through private lenders and follow guidelines set by Fannie Mae and Freddie Mac. Loans that meet these standards are called “conforming loans.”
For 2025, the conforming loan limit in most of Arizona is $766,550. Any loan above that amount is considered a jumbo loan. These limits are reviewed each year to keep pace with changes in home values.
Fixed-Rate Mortgages
Keep your principal and interest payments the same for the life of the loan.
Adjustable-Rate Mortgages (ARMS)
Start with a lower rate that can adjust over time. ARMs can be a smart option if you plan to move or refinance within a few years.
Who Is a Conventional Loan For?
A Great Option for Qualified Buyers
Conventional loans may be a good fit if you:
Have a credit score of 620 or higher
Can provide a down payment between 3 and 20%
Have steady income and a low debt-to-income ratio
Plan to stay in your home long enough to benefit from building equity
Want flexibility in loan terms and the potential to save on mortgage insurance
Conventional vs. FHA Loans
How Conventional and FHA Loans Compare in Arizona
Both loan types help buyers achieve homeownership, but they work best for different situations.
| Feature | Conventional Loan | FHA Loan |
|---|---|---|
| Minimum Down Payment | 3% (for qualified buyers) |
3.5% |
| Credit Score Requirement | 620+ | 580+ |
| Mortgage Insurance | Can be removed at 20% equity | Required for the life of the loan |
| Property Standards | More flexible | Stricter guidelines |
| Best For | Buyers with stronger credit and stable income | Buyers who need more lenient qualification terms |
Why Work With Pete
Clear Guidance From a Local Expert
Pete helps Arizona buyers compare loan options, understand the tradeoffs, and choose a mortgage that fits their goals. Here’s what you can expect:
What you can expect:
- Honest advice comparing Conventional vs. FHA loans
- Guidance on removing PMI and improving affordability over time
- Help reviewing credit, income, and documentation
- Local knowledge of Phoenix, Scottsdale, Chandler, and East Valley markets
- Straightforward answers at every step of the process
Arizona Specific Insight
Why Conventional Loans Are Popular in Arizona
In fast-growing areas like Phoenix, Mesa, and Gilbert, home prices often hover near conforming loan limits. Conventional loans give Arizona buyers the flexibility to stay competitive without the restrictions that come with government-backed programs. They are especially common among repeat buyers and homeowners looking to move up or refinance.
“Pete is simply the best! From start to finish, he walked me through the process, answered all my questions, and responded in a timely manner. I wouldn’t trust anyone else to handle my mortgage transaction, and considering I work within the mortgage industry, that says a lot! Thank you, Pete!”
Cheri B.
Conventional Loan Homebuyer
Latest Articles & Resources
Stay informed with Pete’s expert insights on Arizona mortgage trends.
Learn More
Jumbo Mortgage Resources
Jumbo Loan Limits in Arizona
Current Loan Limits and What They Mean for Arizona Buyers
Common Questions About Conventional Loans
What credit score do I need for a conventional loan?
Most lenders require a credit score of at least 620, but higher scores can unlock better rates and lower insurance costs.
Can first-time buyers get a conventional loan?
Yes. Many Arizona first-time buyers qualify for conventional financing with as little as 3% down.
When does PMI go away on a conventional loan?
Private mortgage insurance can be removed once you reach 20% equity, or it drops off automatically when you reach 22%.
Can I use a conventional loan for a second home or rental property?
Yes. Conventional loans can be used for vacation homes or investment properties, though down payment requirements are higher.
What if my loan amount exceeds the conforming limit?
That would fall under a jumbo loan. Pete can help you compare both options.
Explore Your Conventional Loan Options Today
Pete will help you find the right fit, compare loan types, and understand your best path forward with clarity and confidence.