FHA vs Conventional Mortgage: Which is Best for Tampa Buyers?

If you’re buying a home in Tampa, choosing between an FHA or conventional mortgage can feel overwhelming. Both funding options are popular among Tampa buyers, and the best choice depends on your credit score, financial goals, and down payment savings. Explore Tampa conventional loan options to see how this type of mortgage could fit your needs, or keep reading to compare both loans side by side.

What is an FHA Loan?

An FHA loan is a government-insured mortgage backed by the Federal Housing Administration. It’s designed to help low-to-moderate-income buyers, especially first-time homebuyers, get into a home with a smaller down payment and more lenient credit requirements.

In Tampa’s competitive housing market, FHA loans provide an accessible path to homeownership for consumers who might not qualify for conventional financing. Whether you're purchasing in Seminole Heights, Temple Terrace, or East Tampa, this loan can help make homeownership a reality even if you’re still building your credit or savings.

FHA Loan Pros for Tampa Buyers

Lower down payments (3.5%+): FHA loans allow qualified Tampa buyers to purchase a home with as little as 3.5% down, making it easier to buy sooner. You can also use gift cash from family members to lower the down payment, prepaid expenses, and closing costs.
Lenient credit score requirements (500–580+): Buyers with credit scores as low as 580 can qualify with 3.5% down, and even those with scores between 500–579 may be eligible with a 10% down payment. This flexibility is ideal for buyers rebuilding their credit history or facing past credit card delinquencies or high balances.
Easier qualification for first-time buyers: FHA loans are designed with first-time buyers in mind, offering more forgiving debt-to-income ratios and underwriting standards. This can be a huge help if you're balancing student loans or other debt while trying to buy your first home in Tampa.

FHA Loan Cons for Tampa Buyers

Upfront and annual MIP required: FHA home loans come with a Mortgage Insurance Premium (MIP) that includes an upfront fee (usually 1.75% of the loan amount) and annual premiums paid monthly. This acts like an insurance policy for lenders in case of default, and it's an added cost buyers must factor into their monthly budget.
MIP often lasts the life of the loan: Unless you refinance into a conventional loan later, the monthly MIP typically remains for the full term.
Stricter appraisal standards: FHA loans require a more detailed appraisal and home inspection standards. If the home’s market value is overinflated or the property needs repairs, it could delay or derail your loan approval.

Learn more about FHA loans in Tampa to see if this option fits your needs.

What is a Conventional Loan?

A conventional home loan is a mortgage that’s not backed by the United States government agency like the FHA or VA loans. Instead, it’s funded by private lenders and typically follows guidelines set by Fannie Mae and Freddie Mac. Nonetheless, this loan option still complies with federal and state lending laws to protect consumers. Conventional loans include both conforming loans (within local limits set by the Federal Housing Finance Agency) and jumbo mortgages, which exceed those limits.

In Tampa, conventional loans are a popular choice for buyers with solid credit and stable employment history. They offer more flexibility in property types and often come with lower long-term costs, especially if you can put 20% down. Whether you're eyeing a modern condo in Channelside or a family home in Westchase, a conventional loan can provide more purchasing power and competitive terms.

Conventional Loan Pros for Tampa Buyers

Flexible loan amounts and terms: Conventional loans offer a wide range of loan sizes and repayment options. In high-demand Tampa neighborhoods like South Tampa or Beach Park, this flexibility helps buyers stay competitive.
PMI can be removed at 20% equity: If you put less than 20% down, you’ll pay private mortgage insurance (PMI), but it doesn’t have to last forever. Once you've built up 20% home equity, you can request to cancel PMI, lowering your monthly payments over time.
No upfront mortgage insurance: Unlike FHA mortgage loans, conventional mortgages don’t require an upfront insurance premium. This can reduce your closing costs and make your home purchase more affordable from day one.

Conventional Loan Cons for Tampa Buyers

Higher credit score requirements (620+): Conventional loans typically require a minimum credit score of 620. To get the best rates, Tampa buyers often need a score of 700 or higher, making this option harder to qualify for if you’re still building credit.
Higher down payment needed (5%–20%): While some conventional loans allow as little as 3% down, most lenders prefer 5% or more.
PMI required if under 20% down: If your down payment is below 20%, you’ll be required to pay PMI to offset the lender’s credit risk. This added layer of protection helps lenders reduce the chance of default in case a borrower is unable to repay the loan.

Check your conventional loan eligibility in Tampa to see if this option fits your home buying goals.

FHA vs Conventional Loan Comparison Table

Feature	FHA Loan	Conventional Loan
Min Credit Score	500-580	620+
Min Down Payment	3.5%	3-5%
Mortgage Insurance	MIP for life (unless refinanced)	PMI under 20% down, removable
Loan Limits (2025 Hillsborough)	~$517,500	~$806,500
Eligible Properties	Primary residences only	Primary, second home, investment

Tip: Don’t forget to factor in tax implications when comparing loan options especially if you plan to deduct mortgage interest or real estate taxes.

In today’s changing economy, understanding the differences between FHA and conventional loans can help you make a more confident, informed home financing decision. See our FHA vs Conventional Comparison Chart for detailed side-by-side features and updated loan requirements. Additionally, you can use our mortgage calculator to estimate how Conventional or FHA loans compare based on your finances.

Which Home Loan is Better for Tampa Homebuyers?

Choosing between an FHA and a conventional loan depends on your overall personal finance situation, credit score, and homeownership goals. Here’s a quick guide to help you decide:

When an FHA Loan is Better:

You have a lower credit score (500–579) and can put at least 10% down
Your credit score is 580+ but you want to minimize your down payment (as low as 3.5%)
You’re a first-time homebuyer needing more flexible qualification requirements
You don’t mind paying mortgage insurance for a longer period

When a Conventional Loan is Better:

Your credit score is 620 or higher
You can put 20% down to avoid PMI and lower monthly payments
You want more flexibility in property types (primary, second home, or investment)
You’re looking for higher loan limits in areas like Tampa’s growing neighborhoods

Tip for Tampa Buyers:

When comparing loan offers, don’t just focus on the interest rate—look at the annual percentage rate (APR) as well. The APR reflects the total cost of the loan, including fees and other charges, giving you a clearer picture of what you’ll actually pay over time.

Credit Score vs. Down Payment Guide

Credit Score Range	Typical Minimum Down Payment	Eligible for Best Rates?
500 – 579	10% (FHA only)	❌ Not eligible
580 – 619	3.5% – 5%	❌ Not eligible
620 – 679	3% – 5%	⚠️ Possibly with higher rates
680 – 739	5% or more	✅ Often eligible
740+	10% or more	✅ Strongly eligible

This chart gives you a quick sense of where you may stand as a borrower and what options might be best based on your credit profile.

Check if you qualify for a conventional loan in Tampa to see if this option fits your home buying goals.

Frequently Asked Questions

Is it better to go with an FHA or a conventional loan?

It depends on your financial situation. FHA insured loans are often better for Tampa buyers with lower credit scores or limited down payment funds, while conventional loans are ideal if you have strong credit and want to avoid mortgage insurance by putting 20% down.

Mortgage rates fluctuate based on economic conditions and policy decisions by the Federal Reserve. FHA loans typically offer slightly lower base rates than conventional loans. Buyers can also reduce their interest rate further by purchasing discount points. However, you’ll still need to account for the added cost of mortgage insurance. In the end, the best choice depends on your goals and your target neighborhoods in Tampa.

Why do realtors prefer conventional over FHA?

Many Tampa realtors prefer conventional loans because they often close faster, have fewer strict appraisal requirements, and show sellers that the buyer is financially strong. This is especially important in competitive Tampa areas like Carrollwood, Westchase, and South Tampa, where multiple offers are common.

Can I get a home equity loan with an FHA mortgage?

FHA loans don’t offer traditional home equity loans or HELOCs. If you want to borrow against your home’s value, you’ll typically need to refinance into a conventional loan first.

What is the downside of an FHA loan?

The main downsides of an FHA loan for Tampa buyers are:

Mortgage insurance premium (MIP) is required upfront and annually, often for the life of the loan.
Stricter property appraisal standards, which can make FHA offers less competitive in hot Tampa neighborhoods.
Lower loan limits compared to conventional loans, which can impact buyers shopping in higher-priced areas like South Tampa or Beach Park.

What credit score is needed for a conventional loan in Florida?

To qualify for a conventional loan in Florida, including the Tampa market, you generally need a minimum credit score of 620. However, Tampa buyers with scores of 700 or higher often receive better interest rates and lower PMI costs, helping them save on monthly payments. Lenders will also evaluate your gross income to ensure your debt-to-income ratio stays within acceptable limits usually under 45% for most conventional loans.

How Ebenezer Mortgage Solutions Can Help

At Ebenezer Mortgage Solutions, we specialize in helping Tampa buyers choose the right mortgage with confidence. Whether you're torn between an FHA or conventional loan, our team will walk you through every option, clearly, patiently, and with your goals in mind.

Unlike a bank or credit union, which can only offer their own limited set of loan products, our team can shop across multiple lenders to find the most competitive rates and terms for your unique situation. Rather than working with just one loan officer at a single institution, you’ll have access to a wider range of loan programs and more flexibility through us.

As a trusted Tampa mortgage broker, we provide:

Personalized loan comparisons tailored to your credit, budget, and homeownership plans
Fast pre-approvals to help you compete in Tampa’s hot housing market
Expert guidance from first showing to final closing
Connections with local real estate agents to make your homebuying journey smoother

⭐ 2,000+ Happy Clients | 📍 Tampa-Based | 🕐 Fast Pre-Approvals (99.6% Process Efficiency)

Ready to Choose the Best Loan for Your Tampa Home?

Schedule your free mortgage consultation today to compare FHA and conventional loan options with confidence. Our team will guide you through every step.

📞 Call Ebenezer Mortgage Solutions at (813) 284-4027

📍 See our Google reviews and get directions

Reviewed by Yuleisy Gonzalez Alvarez, NMLS #1507766

CEO & Mortgage Loan Originator at Ebenezer Mortgage Solutions

Yuleisy has over a decade of experience in mortgage lending, including roles in underwriting, processing, and executive leadership. As the founder of Ebenezer Mortgage Solutions in Tampa, FL, she has helped over 2,000 families secure home financing.

What is a Conventional Home Loan? (Tampa Buyer’s Guide)

If you’re buying a home in Tampa, a conventional loan might be your most straightforward path to affordable homeownership. These loans are especially popular in areas like Westchase, Carrollwood, and Brandon thanks to their competitive interest rates, flexible terms, and broad lender availability.

Unlike government-backed options such as FHA (Federal Housing Administration) or VA (Department of Veterans Affairs) loans, conventional mortgages are offered through private lenders and can be tailored to fit your financial goals. They come in several forms and are ideal for borrowers with solid credit and a stable income.

Want to explore your conventional loan options now? Contact Ebenezer Mortgage Solutions for a free consultation or keep reading to learn if a conventional mortgage is right for you.

What Does a Conventional Home Loan Mean?

A conventional home loan is a mortgage that’s not backed by any government agency. Instead, these mortgage loans are financed by private lenders and typically follow guidelines set by Fannie Mae and Freddie Mac. Because of this, they often offer more flexibility in terms of loan structure, property types, and mortgage terms.

Conventional loans generally fall into two categories:

Conforming Loans

These loans meet Fannie Mae and Freddie Mac standards, including loan limits and borrower qualifications. They’re the most common type of conventional loan and are widely used by Tampa homebuyers.

Non-Conforming Loans (Jumbo Loans)

These loans exceed the maximum loan limits for your area. In Tampa, that’s typically over $806,500 in 2025. Jumbo loans have stricter credit and income requirements but are useful for buyers purchasing high-value homes.

Learn about conventional loan eligibility requirements in Tampa to see which option fits your goals.

How Much Do You Have to Put Down on a Conventional Loan?

Your down payment plays a major role in qualifying for a conventional loan. It can also impact your interest rate, monthly payments, and whether you’ll need to pay private mortgage insurance (PMI). In general, the more you put down, the stronger your loan application looks to lenders.

Minimum Down Payment Requirements

Here are the typical minimum down payment requirements for conventional loans:

3% – For first-time homebuyers using certain loan programs
5% – For repeat homebuyers with standard conventional loans
20% – To avoid PMI and reduce your monthly mortgage cost

Keep in mind: Even if you qualify for the 3% minimum, putting more down can strengthen your offer in competitive markets like Tampa.

Tampa Down Payment Context

In the Tampa Bay area, most conventional loan buyers put down between 5% and 20%, depending on their credit profile, home price, and financial goals.

While 3% is the minimum for qualified first-time buyers, many choose to put down 10% or more to make their offers more attractive, especially in popular neighborhoods like Westchase, Carrollwood, and Brandon, where demand is high and competition is tight.

Tip: Putting down 20% or more not only boosts your negotiating power but also eliminates the need for private mortgage insurance (PMI)—which can save you hundreds per month on your mortgage payment.

Looking for assistance with your down payment? Learn more about Florida Down Payment Assistance options in our guide.

What is the Downside of a Conventional Loan?

While conventional home loans offer plenty of advantages, they’re not the right fit for everyone. Conventional loans pose more credit risk to lenders than government-backed loans, hence, they come with stricter approval standards. It’s important to understand the potential drawbacks before deciding.

Here are a few things to keep in mind:

Higher Credit Score Requirements: Most lenders require a minimum credit score of 620 for conventional loans, but you'll need a higher score to get the best rates.
Private Mortgage Insurance (PMI): PMI protects lenders in case a borrower defaults on the loan, but it adds to your monthly payment until enough equity is built.
Stricter Debt-to-Income (DTI) Limits: Compared to government-backed loans like FHA, conventional loans have tighter limits on your DTI ratio, which can make qualifying more difficult for some buyers.

Bottom line: If you have strong credit and enough savings for a larger down payment, a conventional loan can be a great choice and offer long-term financial security. But if you’re still building credit or have a higher DTI, an FHA loan might be worth exploring.

Conventional Loan vs FHA: Which is Better?

Both conventional loans and FHA loans are popular options for Tampa homebuyers—but they serve different needs. Your choice depends on your credit score, budget, and long-term goals.

FHA vs Conventional Loan Comparison

Feature	FHA Loan	Conventional Loan
Min Credit Score	580	620
Min Down Payment	3.5%	3%
Mortgage Insurance	MIP required for life (unless refinanced)	PMI required under 20% equity; removable
Eligible Properties	Primary residences only	Primary, second homes, investment
Loan Limits (2025)	Varies by county	$806,500 (most FL counties)

Which is Right for You in Tampa?

If you have strong credit, a steady income, and want more flexibility in property types (like a second home or rental), a conventional loan may be your best option.
If you're a first-time buyer with a lower credit score or limited savings, an FHA loan might offer a smoother path to homeownership.

Want more information? Check out our FHA vs Conventional mortgage comparison guide to dig deeper into the pros and cons of each option.

Conventional Loan Requirements in Florida

To qualify for a conventional loan in Florida, including the Tampa Bay area, you’ll need to meet certain financial and credit criteria. These requirements can vary slightly by lender, but here are the general minimums most borrowers must meet:

Credit Score

Lenders will carefully review your credit history to assess payment behavior and determine your eligibility and rate.

Minimum: 620
A higher score (typically 740+) may help you qualify for lower interest rates and better loan terms.

Debt-to-Income Ratio

Ideal: 45% or lower
Some lenders may allow up to 50% with compensating factors like strong credit, large savings, or a high down payment. Monthly debts like student loan payments, auto loans, and credit cards are also factored into your DTI.

Employment and Income Verification

You’ll need to show proof of steady income with documents such as:

W-2 forms
Recent pay stubs
Tax returns (especially if self-employed)
Bank statements for asset verification

Home Loan Limits

As of 2025, the conforming loan limit for most Florida counties including Hillsborough County (Tampa) is $806,500.

If your loan amount exceeds this, you'll be looking at a jumbo mortgage, which has stricter requirements.

Pros and Cons of Conventional Loans

Before choosing a mortgage, it’s important to weigh the advantages and disadvantages of conventional loans. While they’re a great fit for many Tampa homebuyers, they may not suit every financial situation.

Advantages

Competitive Interest Rates: Buyers with good to excellent credit often benefit from lower interest rates compared to government-backed loans.
Flexible Property Options: Use a conventional loan to finance a primary residence, second home, or investment property, something FHA loans don’t allow.
No Mortgage Insurance with 20% Down: Put down 20% or more cash upfront, and you’ll avoid private mortgage insurance (PMI) altogether, saving you money every month.
PMI is Removable: Even if you start with PMI, it can be removed once you reach 20% home equity, unlike FHA’s mortgage insurance which typically lasts for the life of the loan.

Disadvantages

Higher Credit Requirements: You’ll need a credit score of at least 620 and higher for the best rates.
PMI for Low Down Payments: If you put down less than 20%, you’ll need to pay PMI, which increases your monthly mortgage cost.
Stricter Documentation: Conventional loans often require more detailed income and asset verification, which can be a hurdle for self-employed buyers or those with irregular income.

Want to estimate your payment with different down payment amounts? Use our mortgage calculator to see what fits your budget.

Types of Conventional Loans

Conventional loans aren’t one-size-fits-all. Depending on your financial goals and the type of property you’re buying in Tampa, you can choose from several conventional loan structures.

Here’s a quick overview of the main types:

Fixed-Rate Mortgages

The interest rate stays the same for the entire loan term typically 15, 20, or 30 years.
Ideal for buyers who plan to stay in their home long-term and want predictable monthly payments.

Adjustable-Rate Mortgages (ARMs)

The interest rate is fixed for an initial period (e.g., 5, 7, or 10 years), then adjusts annually based on market rates.
Often starts with a lower rate than fixed mortgages, making it attractive for buyers who plan to sell or refinance within a few years.

Jumbo Loans

These are non-conforming loans that exceed the standard loan limit (over $806,500 in most of Tampa for 2025).
Best for buyers purchasing luxury homes or high-priced properties, but they require strong credit and financial reserves.

FAQs

What is a conventional loan in Florida?

A conventional loan in Florida is a mortgage not backed by the government, like FHA or VA loans. Instead, it’s funded by private lenders and usually follows Fannie Mae or Freddie Mac guidelines. Conventional loans are popular among Tampa buyers because they offer competitive rates and flexible property options for those with solid credit.

What is the conventional mortgage rate in Florida?

Conventional mortgage rates in Florida change regularly based on market conditions, your credit score, and your down payment amount. As of this writing in 2025, rates have generally varied between 6% and 7% for well-qualified buyers. However, exact percentages depend on your financial profile and lender. For the most accurate and up-to-date rates, it’s best to contact Ebenezer Mortgage Solutions for a personalized quote that fits your goals.

What is the minimum down payment for a conventional loan in Florida?

The minimum down payment for a conventional loan in Florida is 3% for first-time homebuyers. However, many Tampa buyers choose to put down 10-20% to avoid private mortgage insurance (PMI) and strengthen their offers in a competitive market.

Still have questions? Learn all the steps to buying a house in Tampa

How Ebenezer Mortgage Solutions Can Help

Choosing the right mortgage doesn’t have to be overwhelming—especially with a licensed Tampa mortgage broker who brings deep experience, trusted relationships, and local market insight to every step of the process.

At Ebenezer Mortgage Solutions (NMLS #1912387), we’ve helped more than 2,000 Florida families navigate the home loan process and successfully close over 1,000 mortgage deals. Our CEO, Yuleisy Gonzalez Alvarez, brings years of real-world mortgage experience—from underwriting to executive leadership—to every client relationship.

Unlike loan officers tied to a single institution, our mortgage brokers work with a wide network of top lenders, giving you access to competitive rates, flexible guidelines, and loan products tailored to your income, credit history, and long-term goals.

Here’s how we support Tampa homebuyers from application to closing:

Personalized Loan Comparisons: Whether you're exploring a conventional mortgage, FHA, VA, or USDA loan, our team explains each option clearly—including terms, rates, fees, and qualification requirements.
Fast Pre-Approvals: Our pre-approval process is efficient and designed for Tampa’s fast-moving market. With a 99.6% efficiency rating, we make sure you're ready to make a confident offer with full lender support.
Local Expertise + Bilingual Support: With deep roots in Tampa and a bilingual team, we guide clients in English and Spanish through everything from underwriting to closing—while also connecting you to trusted local real estate agents.

Ready to Secure Your Tampa Home Loan with Confidence?

Schedule your free consultation today and get personalized conventional loan advice. Call Ebenezer Mortgage Solutions to start your Tampa home buying journey with a trusted mortgage broker.

📞 (813) 284-4027

📍 See our Google reviews and get directions

Conventional Home Loan Eligibility Requirements in Tampa

Purchasing a home in Tampa, Florida? A conventional loan can be a great financing option, offering competitive interest rates, flexible terms, and no upfront mortgage insurance costs for qualified borrowers. To secure a conforming loan, you'll need to meet specific eligibility criteria related to credit score, income, debt, and property requirements.

Understanding these qualifications can help you navigate the real estate market with confidence and increase your chances of mortgage loan approval. In this guide, Ebenezer Mortgage Solutions, a trusted mortgage broker in the Tampa Bay Area, provides an in-depth look at what it takes to qualify for a conventional mortgage and how we can help you secure the best financing options available.

What Are Conventional Loans?

Conventional mortgages are one of the most popular loan options for homebuyers in Florida. Unlike government-backed loans—such as those offered by the Federal Housing Administration (FHA), the United States Department of Agriculture (USDA), or the Department of Veterans Affairs (VA)—conventional loans are issued by private creditors and adhere to Fannie Mae and Freddie Mac guidelines.

There are two main categories of conventional mortgages:

Conforming Loan – These loans meet the loan limits set by the Federal Housing Finance Agency (FHFA) and follow Fannie Mae and Freddie Mac standards. For 2025, the conforming loan limit in Tampa, Florida, is $726,200 for a single-family home.
Jumbo Mortgage – These loans exceed conforming loan limits and are designed for luxury homes or high-value properties. They typically require a higher credit score, larger down payment, and significant cash reserves.

Conventional loans typically offer competitive interest rates, flexible terms, and the opportunity to avoid private mortgage insurance (PMI) with a higher down payment, making them a great option for real estate investing and homebuyers looking to build equity.

Key Eligibility Requirements for Conventional Loans in Tampa

To qualify for a conventional mortgage in Tampa, borrowers must meet specific requirements related to credit history, income, debt-to-income ratio (DTI), property eligibility, and underwriting guidelines.

Credit Score Requirements

Your credit score plays a key role in determining loan approval, interest rates, and borrowing power. Lenders assess your credit history to evaluate your past financial behavior, including payment history, outstanding debts, and overall credit management. A strong credit rating, along with a higher credit score, reduces credit risk for your creditor, making it easier to secure favorable loan terms.

Minimum Credit Score Requirements:

620+ – Minimum required by most creditor or lender institutions.
700+ – Qualify for a better interest rate and lower loan cost.
Jumbo Mortgages – Usually require 700+ and significant cash reserves.

Tips to Improve Your Credit:

Reduce credit card balances to keep credit utilization low.
Pay bills on time to build a positive payment history.
Avoid new credit inquiries before applying for a mortgage.
Check your credit report for errors and dispute inaccuracies.

Learn more about how to improve your credit score in our blog: 4 Strategies To Improve Your Credit Score

Income and Employment Stability

Lenders require a stable income, typically verified through recent pay stubs, tax returns, and bank statements. Borrowers relying on a paycheck from employment must show at least two years of consistent income. Self-employed borrowers may need to provide additional documentation, such as tax returns and profit-and-loss statements. During the underwriting process, lenders will verify income sources to ensure financial stability.

Required Documents:

Recent pay stubs
W-2 forms from the past two years
Tax returns (for self-employed borrowers)
Profit-and-loss statements (if applicable)
Bank statements
Social Security Number

To learn more about applying for a mortgage, check out our blog: How to Apply for a Mortgage: 4 Steps Every First-time Homebuyer Should Know

Debt-to-Income (DTI) Ratio

Your DTI ratio measures the percentage of your gross income spent on monthly debt payments (e.g., credit cards, car loans, student loans, and mortgages).

Typical DTI Requirements for Conventional Loans:

43% or lower – Preferred by most lenders.
Up to 50% – May be allowed with strong credit and additional assets.

How to Improve Your DTI Before Applying:

Pay down existing debts (e.g., credit cards, personal loans).
Avoid taking on new debt before applying.
Consider increasing your income (e.g., side job, raise, or bonuses).

Down Payment Requirements

A down payment is a key factor in qualifying for a conventional mortgage. Unlike government-backed loans, conventional loans offer flexible down payment options but require at least 3% for first-time buyers and 5% for repeat buyers.

How Conventional Loans Compare to Other Loan Types:

Conventional Loans: 3%–5%+ down payment.
FHA Loans: Require at least 3.5% down.
VA & USDA Loans: Offer 0% down payment for eligible borrowers.

Making a larger down payment (at least 20%) helps borrowers avoid private mortgage insurance (PMI), lower monthly payments, and secure better loan terms.

Common Sources of Down Payment Funds:

Personal savings or cash reserves.
Gift payments from family members.
Mortgage assistance programs available in Tampa and across Florida.
Grants or special loan programs.
Proceeds from the sale of another property.
Documented income from alimony or child support (if ongoing and verifiable).

A well-structured personal finance plan can help buyers save for a down payment efficiently and improve their mortgage eligibility, increasing accessibility to homeownership in Tampa Bay.

Loan Limits and Property Eligibility

The price of the home you are purchasing must fall within the loan limits set by the FHFA for conventional financing. In 2025, the limit for a single-family home is $726,200, but higher limits apply for multi-unit properties.

Eligible Property Types in Tampa Include:

Single-family homes
Condominiums and townhomes
Multi-unit properties (up to 4 units)
Investment properties and second homes

Lenders also evaluate the property’s fair market value through a home inspection and appraisal to ensure it meets the loan amount requirements. Title insurance, property taxes, and any potential legal issues (such as fraud related to ownership) are carefully reviewed as part of the loan process.

Additional Factors Affecting Eligibility

Mortgage insurance: Required if the down payment is less than 20%.
Collateral: The property must meet lender guidelines regarding condition and value.
Title insurance and property taxes: Ensures the home has a clear title and all necessary taxes are up to date.
Foreclosure: Borrowers with a past foreclosure typically face a waiting period of seven years before qualifying for a conventional loan.

How to Improve Your Eligibility for a Conventional Loan

Boost your credit: Pay bills on time, reduce debt, and avoid new credit inquiries.
Lower your DTI: Pay off existing debts and avoid taking on new debt before applying.
Save money for a higher down payment: A larger down payment can help lower monthly payments and eliminate PMI. At the same time, be aware of lender fees, closing costs, and other expenses when budgeting for your home purchase.
Organize financial documents: Ensure tax returns, pay stubs, and banking statements are up to date and readily available.

To learn more about improving your chances of getting approved, check out our guide on 8 tips to boost your mortgage approval.

Qualify for a Conventional Mortgage Loan in Tampa with a Mortgage Broker

Navigating conventional home loan requirements can be complex, but working with a licensed mortgage broker like Ebenezer Mortgage Solutions can simplify the process. Our team provides personalized mortgage solutions, competitive interest rates, and expert guidance to help you qualify for the best loan options.

Ready to buy a home in Tampa? Let Ebenezer Mortgage Solutions help you find the best conventional mortgage options for your real estate investment. Contact us today at (813) 284-4027 or visit our office at 3638 W Cypress St, Tampa, FL 33607 to get personalized mortgage assistance.

FAQ

What is the minimum credit score for a conventional loan in Tampa?

Most creditors and lenders require a minimum credit score of 620 for a conventional mortgage, but a higher credit rating can improve your interest rate and loan terms. Borrowers with excellent credit history (700+ credit score) may qualify for lower annual percentage rates (APR) and reduced mortgage insurance costs.

Can I qualify for a conventional loan with a high DTI ratio?

Yes, some loan officers allow debt-to-income (DTI) ratios up to 50%, but you may need a strong credit score, higher home equity, or additional assets to offset the risk. Keep in mind that existing debts, such as credit card balances, student loans, or second mortgages, can impact your DTI ratio and loan eligibility. Reducing these debts before applying can improve your chances of approval.

Do self-employed borrowers face different requirements?

Yes, self-employed borrowers must provide additional documentation, such as two years of tax returns, bank statements, profit-and-loss statements, and business financials. Since income can fluctuate, underwriting guidelines for self-employed applicants may require a higher credit score or larger cash reserves to reduce risk.

What is the minimum down payment for a conventional loan in Tampa?

The minimum down payment starts at 3% for first-time homebuyers and 5% for repeat buyers. It's important to create a realistic budget to determine how much home you can afford while keeping monthly payments manageable. You can use our mortgage calculator to estimate your down payment amount, monthly payments, and overall loan costs based on different financing scenarios.

How does mortgage insurance affect my loan?

If your down payment is less than 20%, private mortgage insurance (PMI) is required, which increases your monthly mortgage payment. Unlike home insurance, which protects the homeowner, PMI protects the lender in case of default. PMI costs vary based on your credit score, loan amount, and risk factors but can typically be removed once you've built enough home equity.

Can I use a second mortgage or HELOC with a conventional loan?

Yes, some borrowers use a second mortgage or a home equity line of credit (HELOC) to finance a portion of their down payment, home improvement projects, or debt consolidation. However, lenders will consider total debt obligations when evaluating your DTI ratio and loan risk.

Can I refinance my conventional loan through cash-out refinancing?

Yes! Cash-out refinancing allows borrowers to tap into home equity by refinancing their existing mortgage for a higher amount and receiving the difference in cash. This can be used for home renovations, real estate investing, or debt consolidation. However, underwriting fees, interest rates, and market conditions should be carefully evaluated before refinancing.

How can Ebenezer Mortgage Solutions help me secure a conventional loan?

Working with a local mortgage broker like Ebenezer Mortgage Solutions gives you access to a wide range of lenders, creditors, and loan programs, including conforming loan, FHA, VA, USDA home loans, and refinancing options. Unlike banks, loan officers, and credit unions that only offer their own products, we shop multiple lenders on your behalf to ensure you get a mortgage loan that fits your budget and financial goals.

Conventional Loan Requirements in Texas: What You Need to Know

If you've been dreaming of owning a house in Texas, you can consider applying for a Texas conventional loan. This type of mortgage is ideal for homebuyers with a strong credit history and substantial savings. Opting for a conventional loan may be a cost-effective choice if you are financially secure.

If you will purchase your dream home this year, you could be eligible for a Texas conventional mortgage loan. To apply and meet the requirements for this type of loan in 2023, Ebenezer Mortgage Solutions is here to help!

Learn about the conventional loan requirements, Texas, including credit score and down payment requirements, so you can be prepared when applying for a mortgage. Get the information you need to know to make the process as smooth as possible.

What is a Conventional Loan?

A Texas conventional mortgage loan is a type of home mortgage that is not backed or insured by the federal government. Rather, these loans follow the guidelines set by Fannie Mae and Freddie Mac and are commonly referred to as "conforming" mortgages.

Conventional loans are generally considered to be less risky for lenders than government-backed loans, and borrowers typically need to meet stricter eligibility criteria, such as having a higher credit score and a larger down payment.

Since conventional loans conform to the standards of Fannie Mae and Freddie Mac, borrowers may be able to access more competitive interest rates and terms when applying for a conventional loan in Texas.

Benefits of a Conventional Home Loan

A conventional home loan in Texas offers several benefits to borrowers. Unlike government-backed loans, conventional loans provide more flexibility in terms of loan amounts, repayment options, and property types, making it easier for borrowers to find a loan that fits their specific needs.

Additionally, borrowers who can make a down payment of 20% or more may not need to pay for private mortgage insurance (PMI), resulting in significant savings over the life of the loan.

Conventional loans often have lower interest rates than government-backed loans, particularly for borrowers with good credit, which can also save borrowers money over the life of the loan.

Furthermore, conventional loans do not have an upfront funding fee, unlike government-backed loans such as VA and FHA loans, which can save borrowers thousands of dollars at the time of closing.

Finally, conforming conventional loans offer more refinancing options, making it easier for borrowers to take advantage of lower interest rates or other favorable loan terms.

Overall, a conventional home loan in Texas is a great option for borrowers who have good credit and substantial savings and are looking for a loan that offers flexibility, lower interest rates, and potential savings.

Conventional Loan Requirements in Texas

In Texas, conventional mortgage loan requirements can vary depending on the lender, but generally, they must meet certain guidelines set by Fannie Mae and Freddie Mac. These requirements include:

A minimum credit score of 620
A debt-to-income ratio below 43% (although this can vary based on qualifying factors)
A down payment of at least 3% of the home's purchase price

Additionally, the loan amount for a conventional mortgage loan must fall within the conforming loan limits, which are determined by the Federal Housing Finance Agency (FHFA) and are reevaluated annually.

In most areas of Texas, the conforming loan limit is up to $726,200, although it can be higher in certain high-cost areas. Meeting these requirements can help borrowers access more competitive interest rates and terms when applying for a conventional loan in Texas.

Minimum Down Payment for a Conventional Loan in Texas

Contrary to popular belief, it's not necessary to have a 20% down payment to qualify for a conventional loan. In fact, some conventional loans can be obtained with as little as a 3% down payment.

In total, there are six main conventional loan options available in Texas that offer down payments ranging from 3% to 20%. This means that borrowers have some flexibility in selecting the loan that best fits their financial situation and goals.

How Do You Qualify for a Conventional Loan?

Many prospective homebuyers mistakenly believe that qualifying for a conventional mortgage is difficult, particularly if their financial circumstances are less than perfect. However, this is not necessarily true.

Similar to government-backed loans, meeting the requirements for a conventional loan involves demonstrating that you have the ability to cover monthly mortgage payments, a stable income, sufficient funds for the down payment, and a solid credit history with a decent score.

While the standards for qualifying for a conventional loan may be slightly more stringent than for FHA or VA loans, they are still flexible enough for most homebuyers to meet. Therefore, with the right financial preparation and planning, many homebuyers can qualify for a conventional loan in Texas.

Credit score requirements

The average credit score for approved mortgage applicants is 744, which is more than sufficient to qualify for a conventional loan.

Most conventional loans require a minimum credit score of just 620. Lenders look for evidence that borrowers pay their bills on time and have demonstrated responsible financial habits.

Borrowers with slightly lower credit scores may still qualify for a conventional loan, but lenders may impose higher interest rates to offset the increased risk. Those with lower credit scores might consider applying for a Federal Housing Administration loan, which does not typically charge extra fees or higher rates for lower credit scores.

Before applying for a mortgage, it's a good idea to check your credit report to determine where you stand. This can help you identify any areas of concern and potentially take steps to improve your credit score.

Employment and Income Requirements

As part of the mortgage application process, home buyers are required to provide proof of earnings, which may include documents such as 30 days of pay stubs, two years of W2s, and two years of tax returns for the self-employed. An offer letter may suffice for those who haven't yet started.

Lenders typically require two-year documentation to demonstrate consistent earnings. Alimony payments documented in a divorce decree and recurring automatic deposits are also considered. Seasonal income may be accepted with proof in a tax return.

Property Requirements

Before a lender approves a mortgage, the home must be appraised to determine its fair market value. The appraisal must meet the agreed purchase price; otherwise, the home buyer can use it to negotiate a lower price, pay the difference out of pocket or add it to the down payment.

Property value is not the only factor considered in the appraisal, as sometimes the appraiser may require an additional professional's opinion. Conventional loans have less strict appraisal and property requirements than FHA, VA, or USDA loans, meaning that you can qualify for a home in worse condition and make the repairs after the loan is approved and you move in.

Conventional Loan Limits

Conventional loan limits vary by location, with a nationwide starting limit of $726,200. However, in certain high-priced ZIP codes, Fannie Mae and Freddie Mac may allow loan amounts up to $1,089,300. Homebuyers should check the specific limit for their area if they need a loan amount above the standard limit. Loans that exceed conventional loan limits are known as non-conforming loans and require a jumbo loan instead.

Debt-to-Income Ratio

Conventional loan eligibility is determined in part by the buyer's debt-to-income ratio (DTI). DTI compares a borrowers' gross income to their total monthly debts, including mortgage costs, to determine the size of the mortgage payment they can afford. While many lenders prefer a DTI of 36% or lower, conventional loans may accept a DTI of up to 43%. To calculate your DTI, add up your monthly loan payments, projected mortgage payments, and any child support or alimony payments, and divide by your monthly gross income (pre-tax).

Closing Costs

Closing costs will involve charges such as the lender's origination fee and vendor fees like the appraisal, title insurance, and credit reporting fees.

Depending on the market strength and the willingness to close the transaction, a lender or seller may pay some or all of these costs.

Check with your lender to see if they offer lender credits and confirm that any seller contributions adhere to Fannie Mae and Freddie Mac's guidelines.
Seller contributions are typically limited to a percentage of the purchase price based on the down payment amount:

Less than 10% down: 3%
10-25% down: 6%
More than 25%: 9%

For rental or investment properties, the seller can only contribute 2% of the purchase price toward closing costs.

Check Conventional Loan Eligibility with Ebenezer Mortgage Solutions

Are you in the market for a home and considering a conventional loan? Take advantage of the opportunity to get the best rates and terms available.

Contact us at Ebenezer Mortgage Solutions today to check your eligibility for a conventional loan. Our experienced mortgage broker in Texas will guide you through the process and help you find the right loan for your needs. Take the first step toward your dream home, and contact us now.

If you're ready to purchase your home, reach out to us immediately. For questions about home loans, whether it's conventional loans, FHA loans, or any other mortgage programs, we will be more than happy to answer them.

Call us today at (813) 284 - 4027, and let us start working on your mortgage application.

Conventional Loan Limits in Texas: How Much Can You Borrow?

There's a maximum amount you can borrow when you get a mortgage. On a personal level, this limit will depend on your creditworthiness and how much you can comfortably spend each month.

On a larger scale, lenders are also restricted on the amount they can lend to borrowers if they wish to conform to the guidelines set by the Federal Housing Finance Agency (FHFA). Loans that meet these guidelines are referred to as conforming loans.

If you're planning to buy a property in Texas, this article will help you determine the maximum conventional mortgage you can borrow this 2023.

What is a Conventional Loan?

What is a Conventional Loan: A Texas conventional mortgage loan is a type of home mortgage that is not backed or insured by the federal government. Rather, these loans follow the guidelines set by Fannie Mae and Freddie Mac and are commonly referred to as "conforming" mortgages.

Conventional loans are generally considered to be less risky for lenders than government-backed loans, and borrowers typically need to meet stricter eligibility criteria, such as having a higher credit score and a larger down payment.

Since conventional loans conform to the standards of Fannie Mae and Freddie Mac, borrowers may be able to access more competitive interest rates and terms when applying for a conventional loan in Texas.

How Do Mortgage Loan Limits Work?

Before we go into details about the conventional loan limits in Texas for 2023, let's first discuss how mortgage loan limits work.

Loan limits refer to the maximum amount borrowers can receive for a mortgage loan. These limits are set by government agencies, such as the FHFA, to ensure that borrowers are not taking on more debt than they can reasonably handle. Loan limits are based on the median home prices in the local housing market and are adjusted annually.

It's important to note that loan limits only serve as a cap on the maximum amount a borrower can receive. It is not a guarantee that the lender will approve a loan for that full amount. As mentioned above, factors such as the borrower's creditworthiness and income play a major role in determining the amount of mortgage they can be eligible for.

Conventional Loan Limits in Texas for 2023

Unlike FHA loans, conventional loans are mortgages that are not guaranteed by the government. Instead, they are offered by private lenders and are often insured by two government-sponsored entities—Fannie Mae (Federal National Mortgage Association) and Freddie Mac (Federal Home Loan Mortgage Corporation).

Conventional loan limits are set by the FHFA. And for 2023, the conventional loan limit for a single-unit property in Texas is $726,200 which is a 12.21% increase from last year's loan limits. This increase in loan limits is a good thing as it offers more buying power to potential home buyers. Additionally, knowing about these loan limits can help you determine the amount you can afford to borrow and set realistic expectations for your home purchase.

Baseline Conforming Loan Limits for Unit-Property in Texas for 2023

Conforming loans and conventional loans are often used interchangeably. However, they have one key distinction that sets them apart from each other.

Simply put, a conventional loan that follows the loan limit guidelines set by the FHFA is called a conforming loan. So it's safe to say that all conforming loans are conventional loans, but not all conventional loans are conforming loans.

For 2023, the baseline limits for most areas in the United States, including Texas, are as follows:

1-unit property: $726,200
2-unit property: $929,850
3-unit property: $1,123,900
4-unit property: $1,396,800

It's important to remember that these limits serve as just the standard maximums. In regions with expensive real estate markets, these conforming loan limits will be significantly higher.

Maximum Conforming Loan Limits for 2023

Now for high-cost counties, the conforming loan limits can also go as high as the following:

1-unit property: $1,089,300
2-unit property: $1,394,775
3-unit property: $1,685,850
4-unit property: $2,095,200

Some of these high-cost areas are within California, Virginia, Colorado, the District of Columbia, Massachusetts, and New Hampshire.

Jumbo Loan Limit in Texas for 2023?

A jumbo loan is a type of mortgage that exceeds the conforming loan limit set by the FHFA. While conforming mortgages can be purchased or guaranteed by Fannie Mae or Freddie Mac, jumbo loans are not eligible for such.

Jumbo loans are often used to finance luxury properties. The loan limit for a jumbo loan will all depend on the mortgage lender you're working with. In most cases, the amount you can borrow can go up to $2 or $3 million.

Since jumbo mortgages are not guaranteed by Fannie Mae or Freddie Mac, and since it involves a larger amount of money, they pose a greater risk to mortgage lenders. With that, the requirements needed to qualify for a jumbo loan are more stringent compared to conforming loans. This often includes a credit score of 700, a debt-to-income (DTI) ratio of 43% or lower, and a 10% minimum down payment.

Jumbo loans are usually appropriate for borrowers known as HENRY—high earners, not rich yet. In other words, these are the people who generate a lot of money but don't have millions of dollars in cash or other assets yet.

Bottom Line

A conventional loan can be either conforming or non-conforming. Conforming loans follow the loan limits or guidelines set by the FHFA. On the other hand, non-conforming loans or jumbo loans go beyond these conforming loan limits.

In Texas, the baseline limit for a single-unit property is $726,200 which is a $79,000 increase from 2022's conforming loan limit. This increase means that the borrower will now have more buying power in the ever-competitive real estate market.

Need Help in Getting a Conventional Loan in Texas?

If you're planning on applying for a conventional loan in Texas, then Ebenezer Mortgage Solutions can help you.

Ebenezer Mortgage Solutions is a mortgage broker company based in Florida but is now also offering services in Texas. We work with multiple mortgage lenders. This means that we can get you access to better mortgage deals and options that are not available with your regular bank.

We also understand that the whole mortgage process can be overwhelming especially for first-time home buyers. That's why our services include applying for these lenders so that you don't have to. Moreover, we'll be with you from application to closing, guiding and advising you using our years of experience and knowledge. All in all, we aim to provide you with a stress-free and smooth-sailing mortgage process.

Call us today at (813) 284-4027 so we can start looking for the best mortgage option for you.

What is the Conventional Loan Limit for 2022?

Conventional Loan Limit for 2022

A loan limit refers to the maximum mortgage amount a homebuyer can borrow. Each year, the Federal Housing Finance Agency (FHFA) sets a new limit to which lenders adhere.

Although FHFA usually announces the loan limit for the next year in November, some lenders are already honoring the new limit as early as October. Read on to learn more about the new conventional loan limit for 2022 and what this recent change means for homebuyers.

What is a Conventional Loan?

A conventional home loan is a type of mortgage not guaranteed by the government. Instead, it is offered by private companies such as Fannie Mae and Freddie Mac. Conventional loans are often divided into two types: conforming and non-conforming.

Conforming loans are mortgages that follow the loan limit set by the FHFA. This is the regular loan that most homebuyers are familiar with. First-time homebuyers can make a 3% down payment. Second-time homebuyers would need a minimum of 5% down. But if you want to skip paying the premium mortgage insurance, you'll have to make a 20% down payment. Additionally, you'll need a credit score of at least 620 and a debt-to-income (DTI) ratio of 50%.

On the other hand, if the borrower needs a home loan that exceeds this limit, they would have to opt for a non-conforming mortgage, also called the jumbo loan. Jumbo loans don't follow the FHFA standards. They can also be tougher to qualify for. Some of the requirements for a jumbo loan include a minimum down payment of 10% and a credit score of at least 700.

Conforming Conventional Loan Limit for 2022

Every year, the FHFA updates the conventional loan limit depending on the market value of properties. Usually, the FHFA announces the changes in November. But early in October, Fannie Mae and Freddie Mac went ahead and increased the conforming loan limit for 2022 to $625,000. This is a $76,750 increase from the current year's limit, which is $548,250. This also means that you can immediately apply for a conventional loan with this higher limit, as most lenders are honoring them now.

What Does The New Conventional Loan Limit Mean for Homebuyers?

The increase in the conforming loan limit could be advantageous for some and disadvantageous for others. The advantage is that homebuyers are now able to afford more expensive houses with a conventional loan. For example, with a 3% down, you'll be able to buy a home with a maximum purchase price of $644,329. In other words, you'll be able to afford a home that is $80,000 more expensive than the 2021 maximum purchase price.

The increase would also allow you to make a higher offer. This means that with a conventional loan, you'll have a higher chance of being chosen by the seller over homebuyers with a different mortgage type.

However, since conventional loans have less strict requirements, many people will have access to the new loan limit. Therefore, this could be disadvantageous for some homebuyers because the marketplace could be more competitive than ever before.

Conclusion

The 2022 conforming loan limit increased to $625,000. This would allow you to afford houses that are $80,000 more expensive than this year's maximum purchase price. But keep in mind that you would still have to qualify with the conventional loan requirements to take advantage of it. And if you exceed the new loan limit, even by just $1, you would have to get a jumbo loan which can be harder to qualify for.

Conventional Loan Mortgage Brokers

If you want to take advantage of the conventional loan limits in Florida this 2022, the mortgage broker at Ebenezer Mortgage Solutions would be more than happy to help you. Call us today at (813) 284 - 4027, so we can start working on your mortgage application.