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What Is a Conventional Mortgage Loan?
A conventional loan is simply a mortgage that is not backed by any government agency. It follows guidelines set by Fannie Mae and Freddie Mac — the two largest buyers of home loans in the U.S. For most Texas homebuyers with decent credit and some savings, conventional is the most versatile and cost-effective path to homeownership.
Primary, Second & Investment
Use a conventional loan for your main home, a vacation property, or a Texas investment rental — unlike FHA and VA, there are no primary residence requirements.
PMI That Goes Away
Put less than 20% down and pay PMI — but unlike FHA mortgage insurance, conventional PMI automatically cancels once you reach 20% equity in your home.
Higher Loan Limits
The 2026 conforming limit in Texas is $832,750. Need more? Jumbo conventional loans go up to $2M+ for luxury Texas properties in Dallas, Austin, and Houston.
Texas Conventional Loan Programs
There is more than one type of conventional loan. Here are the programs we commonly use for Texas buyers.
Standard Conventional — 5% Down
The most common loan for Texas homebuyers. 5% down, 620+ credit, loans up to $832,750. PMI cancels at 20% equity. Rates are highly competitive for borrowers with scores above 680.
Fannie Mae HomeReady — 3% Down
Only 3% down required. Designed for low-to-moderate income buyers. Reduced PMI rates, flexible income sources, and gift funds allowed. Minimum 620 credit score. See Texas first-time homebuyer programs →
Freddie Mac Home Possible — 3% Down
Freddie Mac’s answer to HomeReady. Also 3% down with flexible income requirements. Great for buyers in lower income brackets or those using boarder income to qualify. Reduced PMI, 660+ credit preferred.
Jumbo Conventional — Above $832,750
For luxury homes in Dallas, Austin, Houston, and the Hill Country. Loan amounts from $832,751 to $2M+. Typically require 10–20% down and a 700+ credit score. We shop multiple jumbo lenders to find your best rate.
Investment Property — 15–25% Down
Buying a Texas rental property? Conventional loans allow 1–4 unit investment purchases with 15% down on single-family homes. Compare with our DSCR loan option — often better for investors.
Conventional Refinance — Rate or Cash-Out
Lower your rate, shorten your term, or access equity. Conventional cash-out refinance is available in Texas (unlike FHA cash-out restrictions). Learn more on our Texas refinance page.
2026 Conventional Loan Requirements — Texas
Here are the standard qualification benchmarks for Texas conventional loans in 2026.
| Requirement | Standard Conv. | HomeReady / Home Possible |
|---|---|---|
| Min. Down Payment | 5% | 3% |
| Min. Credit Score | 620 | 620 (660 preferred) |
| Max. Loan Amount (2026) | $832,750 | $832,750 |
| Max. LTV | 95% | 97% |
| PMI Required | If <20% down (cancels at 20%) | Reduced PMI (cancels at 20%) |
| Interest Rate | Varies by lender & profile | Varies by lender & profile |
| Property Types | Primary, 2nd home, investment | Primary residence only |
Rates vary by lender, credit profile, and market conditions. We shop multiple lenders to find your best available rate. Contact Adam for a personalized quote →
Get your free loan comparison in minutes — conventional, FHA, and VA side by side, no credit check required.
Conventional vs FHA vs VA — Texas 2026
Not sure which loan is right for you? Here is how the three most common Texas home loans compare side by side. We run this analysis for every client — at no cost.
| Feature | Conventional ✓ | FHA | VA |
|---|---|---|---|
| Min. Down Payment | 3% (HomeReady) | 3.5% | $0 (veterans only) |
| Min. Credit Score | 620 | 500 (580 for 3.5% down) | No minimum (lender sets) |
| Mortgage Insurance | PMI — cancels at 20% | MIP — often life of loan | None (funding fee only) |
| 2026 Loan Limit (TX) | $832,750 (+ jumbo) | Varies by county | No limit (full entitlement) |
| Property Types | Primary, 2nd, investment | Primary only | Primary only |
| Best For | 620+ credit, 5%+ down, investors, 2nd homes | Below 620 credit, limited savings | Eligible veterans, $0 down |
| Who Qualifies | Anyone | Anyone | Veterans & active duty |
Adam’s Approach: We run the numbers on every loan type for you — conventional, FHA, and VA — so you can see the true monthly cost and long-term savings of each option side by side. Most clients are surprised by which one actually wins. Let’s compare yours →
Why Texas Buyers Choose Conventional
For buyers with solid credit and steady income, conventional loans offer flexibility that government-backed loans simply cannot match.
PMI That Cancels
Unlike FHA MIP which often lasts the life of the loan, conventional PMI cancels automatically when you hit 20% equity.
Buy Any Property Type
Primary home, vacation cabin in the Hill Country, or a rental duplex in Houston — conventional covers them all.
3% Down for First-Time Buyers
HomeReady and Home Possible programs open the door with just 3% down — less than FHA’s 3.5% — with lower PMI rates.
No Upfront Funding Fee
FHA charges a 1.75% upfront MIP. VA charges a funding fee. Conventional has neither — your down payment goes straight to equity.
Competitive Rates at 680+
Borrowers with scores above 680 often find conventional rates beat FHA — especially once you factor in FHA’s lifetime mortgage insurance.
Cash-Out Available in Texas
Texas Section 50(a)(6) restricts FHA and VA cash-out — but conventional cash-out refinance is available. Learn more →
Conventional, FHA, or VA — Which Wins for You?
We run a side-by-side comparison for every Texas buyer — no cost, no obligation, no credit check to start.
LET’S TALKFree loan comparison • No pressure • No upfront credit check
How the Conventional Loan Process Works
From first conversation to closing day — here is what to expect working with Bartling Lending.
Free Consultation
Discuss your goals, credit, income, and down payment. No credit pull required.
Loan Comparison
We compare conventional, FHA, and VA options side by side so you can make an informed decision.
Shop Lenders
We submit to multiple lenders to find your best available rate — we work for you, not a bank.
Pre-Approval
Get a strong pre-approval letter that makes your offers competitive in the Texas market.
Close & Move In
Conventional loans close in 21–30 days. Same dedicated team from application to your keys.
Conventional Loans Across Texas
We serve homebuyers and investors in all 254 Texas counties — Houston, Dallas–Fort Worth, San Antonio, Austin, El Paso, the Hill Country, and beyond.
Every Texas buyer gets the same conventional vs FHA vs VA comparison, the same multi-lender shopping, and the same dedicated processor from application through closing. Get started today →
Conventional Loan FAQs — Texas 2026
Plain-English answers to the most common conventional mortgage questions from Texas buyers. Click any question to expand.
What is a conventional mortgage loan?
A conventional loan is any home loan not backed by a government agency. It follows guidelines from Fannie Mae and Freddie Mac and is the most widely used loan type for Texas home purchases. No FHA or VA eligibility is required — any qualified buyer can apply.
What is the minimum down payment for a conventional loan in Texas?
As low as 3% down through Fannie Mae HomeReady or Freddie Mac Home Possible for first-time buyers. Standard conventional loans start at 5% down. Put 20% down and you skip PMI entirely — that is a common goal for buyers who want the lowest possible monthly payment.
What credit score do I need for a conventional loan in Texas?
The minimum is 620 for most conventional loan programs. Borrowers with 740 or higher receive the best interest rates. If your score is between 620 and 680, we will compare conventional against FHA to find which gives you the better overall payment.
What is the 2026 conventional loan limit in Texas?
The 2026 conforming loan limit for most Texas counties is $832,750 for a single-family home. Loans above this threshold are jumbo loans and may require larger down payments, but we have access to competitive jumbo lenders for high-value Texas properties.
Is a conventional loan better than FHA in Texas?
For buyers with 680+ credit and at least 5% down, conventional is often the better choice — lower total cost due to cancellable PMI versus FHA’s lifetime mortgage insurance. For buyers with lower credit or limited savings, FHA may still win. We run the numbers both ways for every client before recommending anything.
Do conventional loans require PMI?
Only if your down payment is less than 20%. Conventional PMI typically runs 0.5% to 1.5% of the loan amount per year. The critical advantage over FHA is that conventional PMI automatically cancels once your loan balance drops to 80% of the original home value — FHA MIP often stays for the life of the loan.
Can I use a conventional loan to buy an investment property in Texas?
Yes — and this is one of the biggest advantages over VA and FHA loans, which require owner occupancy. Conventional loans allow purchases of second homes and 1–4 unit investment properties. Investors buying based on rental income should also look at our DSCR loan program, which qualifies on property cash flow rather than personal income.
How long does it take to close a conventional loan in Texas?
Most conventional loans close in 21 to 30 days from contract to close. Our dedicated processor and lender relationships are focused on on-time closings — the same team stays with you from application through the day you get your keys.
Can I remove PMI from my conventional loan?
Yes. PMI automatically cancels when your balance reaches 78% of the original purchase price under federal law. You can also request early cancellation at 80% LTV — sometimes based on an updated home value if your property has appreciated. This is a major long-term cost advantage over FHA.
What income documentation is required?
Standard W-2 employees provide recent pay stubs, two years of W-2 forms, and two months of bank statements. Self-employed borrowers typically provide two years of tax returns. We work with your specific situation and match you to lenders whose documentation requirements fit your income type. Ask us about your options →
What Texas Clients Say
Real reviews from the Bartling Lending Partners Google Business Profile. ⭐ 5.0 average.
“Adam and I served together in Iraq, 2005-2006. He’s a knowledgeable guy in the lending field and fully understands how the VA works when it comes to veterans.”
“Adam is a great, hard, dependable worker and very good to work with. He always looks out for his customers – highly recommend! He will do whatever it takes to get you approved for a new home!”
“Excellent communication throughout the process. I would definitely recommend Bartling Lending if you’re looking for a great lender to get the deal done!”
“Adam and his team gave me a list of what they needed upfront and never left me guessing. They were helpful and honest.”
“My clients and I have experienced excellent service and prompt attention, which really helps you get off on the right foot. Doing business with Bartling Lending – thanks to everyone involved!”
“I’ve known Adam with Bartling Lending Partners for years, and he’s always been a stand-up guy. I trust him completely.”
Explore Other Texas Loan Programs
Adam Bartling | Texas Mortgage Broker · Loan Officer NMLS# 2213358 · Serving Texas · Equal Housing Lender
This page is for informational purposes only and does not constitute a commitment to lend. Loan terms, rates, and eligibility subject to change without notice. All loans subject to credit approval.