Conventional loans
Conventional Loans in Michigan
Conventional is the default path for buyers with established credit, and the thing that separates it from FHA is not the down payment. It is what happens to the mortgage insurance later.
Why Credit Matters More Here
Conventional pricing is driven by your credit profile in a way FHA’s is not. A stronger score generally buys better terms, and a weaker one costs more or does not fit at all. That is why a buyer who was declined on a conventional file is not necessarily a buyer who cannot buy — frequently it means the file was run through the program that is strictest about the one thing they are weakest on.
The assistance I place on the conventional side is sized at 4% of the purchase price. How that works →
The Mortgage Insurance Difference
Conventional mortgage insurance is not permanent. Once you have built enough equity it comes off, and your payment drops without you refinancing. FHA generally does not work that way on most terms.
For a buyer who expects their income and their home’s value to grow, that single difference can outweigh a lot of what happens at the closing table. For a buyer whose credit is still recovering, FHA is usually still the better door. Which one you belong in is a conversation about your file, not a rule.
Conventional Asks for 3% Down
Lower than FHA’s minimum, which surprises people who assume conventional is the stricter program. It is stricter — on credit, not on the downpayment.
The conventional assistance I place is sized at 4% of the purchase price, which is larger than the 3% it exists to cover. That gap is the thing buyers get backwards: the 3% is what you put down, the 4% is how big the help is. How the assistance works →
Representative example, conventional. $300,000 purchase price, single-family primary residence in ZIP 48336 (Oakland County, Michigan), estimated credit score, 30-day rate lock, escrow account not waived. Downpayment $9,000, which is 3% of the purchase price. Loan amount $291,000, which is 97% of the purchase price. Repayment terms: 360 monthly payments of $2,034.71 in principal and interest, at a fixed interest rate of 7.500% for the full 30-year term, with no balloon payment. Monthly mortgage insurance of $160.05 is additional. Property taxes are estimated at $300.00 per month and homeowner’s insurance at $62.50 per month; both vary by community and by property, are not set by the lender, and are not included in the Annual Percentage Rate. Annual Percentage Rate (APR) 8.648%. Rates effective September 14, 2026 and subject to change. This is an estimate for illustration only, not a loan approval, a commitment to lend, or an offer of credit. Until you lock, the rate, APR and terms may change or may not be available at commitment or closing. Your actual rate, payment and costs could be higher. Request an official Loan Estimate before choosing a loan.
The Appraisal Is a Different Animal
An FHA appraisal is partly a condition inspection — the appraiser is checking the house against a standard, and things like peeling paint on an older home or a roof near the end of its life can turn into conditions you have to clear before closing. A conventional appraisal is weighted toward value: what the house is worth against comparable sales.
On the housing stock across Livonia, Sterling Heights and the older parts of Oakland County, that difference decides deals. A house that would generate a list of FHA repair conditions can be a clean conventional file. If you are shopping 1950s and 1960s homes and you have the credit for it, this is a real argument for conventional that almost nobody explains up front.
It Is Not Only for Primary Homes
Conventional financing also covers second homes and investment property, with different terms for each, and it is the program behind most of the higher-balance purchases across Oakland County. If you are buying something other than a house to live in, this is usually where the conversation starts — though for rental property specifically, a DSCR loan is sometimes the better structure.