Amarillo Conventional Home Loans

Conventional loans are the standard mortgage loans you’ll find in the market today. If you go to a lending institution, they probably offer you a conventional loan. Conventional loans can be at your advantage if you have the proper requirements. 

At Capital Home Mortgage, we aim to balance risk and reward. We can offer competitive interest rates if you show us an excellent history of honoring debts. A conventional loan is the best product if you have a strong credit background. Otherwise, we recommend checking FHA loans if you have past debt issues.

Conventional Loan Requirements

Conventional loans are the basis of other home loans like FHA loans. You can use conventional loan requirements to assess if you have what it takes to qualify for this loan type. If you can’t tick most of the requirements, we suggest checking government-insured loans since they are more liberal. 

• Credit Score

The minimum credit score of 620 is required on conventional loans. However, having a score of 620 is not a guarantee of approval. According to Experian, a score of 620 is considered fair, and it is the second to the last score group. If you want to increase your chances of approval, strive to improve your score to at least 670 in the Good score group. It would be much better if you could reach 740 to 799.

• Down Payment

At Capital Home Mortgage, we always look at our client’s convenience. We recommend you put a 20% down payment to skip private mortgage insurance (PMI). Mortgage insurance is an added financial burden to your monthly amortization. As much as possible, try your best to gather 20% upfront cash to save between 0.5% to 5% in mortgage premiums.

• Debt-to-income Ratio

Your debt-to-income ratio says a lot about your credit habits. It’s impossible to live a debt-free life. At some point, you’ll have to touch your credit limit to make purchases. The debt-to-income ratio will depict the percentage of debt concerning your income. Ideally, the front-end DTI ratio should be no more than 28%, and the back-end DTI ratio not higher than 36%. Try settling or consolidating some debts first before you apply.

• Proof of Income and Employment

Prepare your pay stubs, W-2, and certificate of employment as the basic requirements. If you’re a business owner, we want to see your business’s financial statements, federal tax returns, and bank statements. Reach out to our Amarillo mortgage specialists to get a complete list of requirements.

Conforming Loan Limits

The conforming loan limits for Amarillo in Armstrong County are between $420,680 for single homes to $809,150 for four-plex homes.

Apply for a Conventional Loan in Amarillo

As a direct mortgage lender, Capital Home Mortgage oversees all applications from start to finish. We strive to make applications easy and painless. Get qualified for a conventional loan in Amarillo today. Call (806) 589-3428 to start your loan application.