Conventional Mortgage Loan Florida
So you’re ready to purchase your first home? Although this milestone can be exciting, it may also leave you feeling a bit overwhelmed. You may wonder how much of a down payment you’ll need, if your conventional loan lender will require a home inspection, or what kind of credit score you need to qualify for a conventional home loan.
Don’t worry. We’ve got the answers. Here’s what you need to know about a conventional mortgage loan in Florida.
What is a conventional mortgage loan?
There are two types of conventional loans—conforming and nonconforming. Conforming loans qualify for government backing from agencies such as the Federal Housing Administration, U.S. Department of Veterans Affairs, or government-sponsored enterprises like Freddie Mac and Fannie Mae. However, nonconforming loans do not, meaning they represent more risk to lenders.
As a result of government backing, conforming conventional loans, however, present less liability to lenders. This allows a mortgage company to offer better loan terms; whereas, nonconforming loans have stricter requirements, higher interest rates, and higher monthly payments.
What is my Florida mortgage loan limit?
For a single-family home, the limit for most counties in Florida is $647,200 for a conforming conventional loan. In some high-traffic areas, such as Monroe County, that limit is $710,700. These are the total amounts for which government agencies will back a loan. If your loan amount exceeds your area’s limit, a lender will consider your loan nonconforming. While there’s no limit to what you can borrow for a nonconforming conventional loan, you will likely have to meet stricter borrower requirements to qualify for one.
How do I qualify for a conventional mortgage loan in Florida?
We will evaluate the following criteria:
- Proof of income
- Employment verification
- Debt-to-income ratio
- Credit history and score (minimum credit score of 620)
- Your mortgage’s loan-to-value (LTV) ratio
- Proof of your current assets, such as checking, savings, and investment accounts
To receive an OVM Financial personalized mortgage plan, simply provide us with all of this information via our online application.
Will my loan officer require a home inspection?
We do not require a home inspection; however, you should still consider getting one. A home inspection allows you to professionally vet a house before you purchase, so you won’t end up with any unexpected or expensive surprises after closing. You will have to invest an additional $300 to $500 for the inspection fee, but it can save you thousands in the long run. A home inspector will usually evaluate the following property attributes:
- Landscaping and general property maintenance
- Exterior and interior structural integrity
- Roof quality
- Windows, doors, and trim
- Home appliances, such as the HVAC system and water heater
- Pipes, drains, and any water damage
- Termite or other pest damage
You will also need to provide a down payment, which can range from 3% to 20% depending on the type of loan you choose. Don’t forget to factor in additional expenses, such as application fees, closing costs, homeowners insurance, and mortgage insurance.
To get the homebuying process started, reach out to an OVM professional, who can assist you with a conventional mortgage loan in Florida.
If you’d like to keep learning about conventional loans, check out our conventional loan vs. USDA loan comparison guide, or find out if you can get a conventional loan after a foreclosure.