Mortgage Friend · Conventional Loans · Las Vegas, NV
The most common home loan type. As low as 3% down for qualifying buyers, PMI that automatically drops when you hit 20% equity, and loan limits up to $806,500 in Clark County for 2026.
The Basics
A conventional loan is a mortgage not backed by a government agency. Instead, it conforms to guidelines set by Fannie Mae and Freddie Mac — the two government-sponsored enterprises that buy most mortgages on the secondary market. Because lenders can resell these loans, they can offer competitive rates to qualified borrowers.
There are two flavors: conforming (loan amount at or below the county limit — best rates, standard guidelines) and non-conforming / jumbo (above the limit — see our jumbo loan page).
Unlike FHA, conventional loans have no upfront mortgage insurance premium. If your down payment is under 20%, you'll pay PMI — but unlike FHA's lifetime MIP, conventional PMI is removable once you reach 20% equity. That's a significant long-term cost advantage.
Mortgage Insurance
Private mortgage insurance (PMI) protects the lender if you default. It's required on conventional loans with less than 20% down — but unlike FHA mortgage insurance, it's temporary.
PMI typically costs 0.5% to 1.5% of your loan amount annually, depending on your credit score, down payment, and loan size.
On a $400,000 loan:
Higher credit scores and larger down payments push PMI toward the lower end of this range.
Automatic cancellation at 78% LTV
Your lender must cancel PMI automatically when you reach 78% LTV based on the original purchase price and scheduled payments.
Request removal at 80% LTV
You can proactively request PMI removal once you hit 80% LTV — two points earlier than automatic cancellation.
New appraisal if home appreciated
If your home has increased in value, a new appraisal may show 20%+ equity and allow early PMI removal — even if you haven't paid the balance down that far.
Refinance into a new loan
If you have 20%+ equity and rates are favorable, a refinance resets the loan at a lower LTV — no PMI on the new loan.
The key distinction from FHA
FHA mortgage insurance stays for the life of the loan if you put less than 10% down — the only exit is a refinance. Conventional PMI has a clear, built-in exit. For buyers with 620+ credit and a path to 20% equity, conventional is usually the better long-term move.
Rate Pricing
Conventional loans use risk-based pricing. Every 20-point FICO band moves the needle. A 760+ borrower may get a rate 0.5–1.0% better than a 620 borrower — which translates to real dollars every month.
| FICO Score Range | Rate Tier | Est. Rate Premium vs. 760+ |
|---|---|---|
| 760+ | Best available | — |
| 740–759 | Excellent | +0.00–0.10% |
| 720–739 | Very good | +0.10–0.20% |
| 700–719 | Good | +0.20–0.35% |
| 680–699 | Fair–good | +0.35–0.55% |
| 660–679 | Fair | +0.55–0.75% |
| 640–659 | Below average | +0.75–1.00% |
| 620–639 | Minimum threshold | +1.00–1.25%+ |
What does that mean in dollars?
On a $400,000 loan, a 1.0% rate difference is approximately $250/month — or $3,000/year. Over a 5-year horizon, that's $15,000. If your score is borderline, it may be worth a few months of credit work before applying.
2026 Loan Limits
The 2026 conforming loan limit for Clark County (Las Vegas, Henderson, North Las Vegas) is $806,500 for a single-family home. This covers the overwhelming majority of Las Vegas metro purchases — the current median price is around $440,000.
When your loan amount stays under $806,500, you're in conventional conforming territory: best rates, most lender competition, and standard guidelines. This is the sweet spot for most buyers.
If your purchase price pushes the loan above $806,500, you're looking at a jumbo loan — different qualification standards, higher reserve requirements, and stricter credit thresholds. This comes up most often in Summerlin luxury communities and Henderson estates.
Common Questions
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