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(702) 696-9900Check Rate
QUICK ANSWER — conventional pros: 5-20% down payment, 620 credit minimum, flexible DTI up to 57%, 100% gift funds allowed, lower rates than conventional. conventional cons: lifetime mortgage insurance (0.55% annually), 1.75% PMI, loan limits ($532,900 in Clark County), primary residence only, conventional appraisal requirements.
Reviewed by Vatche Saatdjian·Valley West Mortgage·NMLS #65506·790+ five-star reviews

Conventional Loan Pros & Cons

An honest look at conventional strengths and trade-offs. The right loan depends on your credit, savings, and goals.

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HONEST LOOK

The Full Picture

✓ conventional Advantages
✓ Just 5-20% down payment
✓ 620 credit score minimum
✓ DTI up to 57% allowed
✓ 100% gift funds for down payment
✓ Lower rates than conventional
✓ Seller pays up to 6% closing costs
✓ 2 years after bankruptcy OK
✓ 1-4 unit properties eligible
✗ conventional Trade-Offs
✗ Mortgage insurance for life of loan
✗ 1.75% PMI added to loan
✗ Loan limits ($532,900 in Las Vegas)
✗ Primary residence only
✗ conventional appraisal stricter than conventional
✗ Some condos not approved
✗ Sellers may prefer conventional offers
✗ Cannot use for investment properties
FAQ

Questions? Answered.

Yes for most buyers with credit under 720 or less than 10% down. The lower rate and smaller down payment outweigh the PMI cost for the first several years. You can always refinance to conventional once you have 20% equity.

Lifetime mortgage insurance. Unlike conventional PMI which drops at 20% equity, conventional PMI stays for the entire loan. The solution is to refinance to conventional once you reach 20% equity and 620+ credit.

It depends on your timeline. conventional is cheaper in years 1-7 for most borrowers. Conventional becomes cheaper after year 7-10 when PMI drops. If you plan to refinance or sell within 7 years, conventional usually wins.

Some sellers prefer conventional offers due to conventional appraisal requirements. However, a strong pre-approval letter and competitive offer price can overcome this. In balanced markets like Las Vegas 2026, conventional offers are widely accepted.

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REVIEWS

What Homebuyers Say

★★★★★

"Put 20% down, no PMI. Valley West got me 0.25% lower than my bank."

— Las Vegas
★★★★★

"Shopped 50+ lenders. Zero fees. Closed in 25 days."

— Henderson
★★★★★

"Refinanced from FHA to conventional. Saving $350/month."

— North Las Vegas

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(702) 696-9900Check Conventional Rate