Conventional Loans in Florida

What a conventional loan is

A conventional loan is a mortgage that isn't insured or guaranteed by the federal government. Instead, it follows underwriting guidelines set by Fannie Mae and Freddie Mac, the two government-sponsored entities that buy most conventional loans from lenders after closing. That's different from an FHA loan, which carries federal mortgage insurance, or a VA loan, which carries a federal guaranty.

Conventional is the most common loan type in the country, and for good reason — it works for a wide range of buyers, properties, and situations, from a first home to a second home to an investment property.

Conventional loans also come in more shapes than people expect. You can choose a fixed-rate loan, where your principal and interest payment stays the same for the life of the loan, or an adjustable-rate option, where it can change after an initial period. Term lengths vary too — a 30-year term is the most common because it keeps the monthly payment lower, but shorter terms exist for buyers who'd rather pay the loan off faster and are comfortable with a higher monthly payment. Which structure makes sense depends on how long you plan to stay in the home and what you're trying to optimize for — I'll walk through the tradeoffs with you rather than default to whatever's most common.

Conforming loan limits in Florida

Fannie Mae and Freddie Mac only purchase loans up to a maximum size, set annually by the Federal Housing Finance Agency (FHFA). For 2026, the one-unit conforming loan limit is $832,750 in every Florida county except Monroe County, which has a higher high-cost limit due to its higher home values.

A loan above the conforming limit for a given county is called a jumbo loan, and it follows different underwriting standards — jumbo loans aren't something I cover on this page, but ask me if your purchase price is getting close to the limit.

One thing worth remembering: these limits change every year, typically going up as home prices rise nationally. I keep the current figure on this page, but if you're reading this well after 2026, confirm the latest number with me or directly on FHFA's site.

Down payment and private mortgage insurance (PMI)

You don't need 20% down to get a conventional loan — that's one of the most persistent myths out there. Conventional loans allow a range of down payment levels, and plenty of buyers put down meaningfully less than 20%. If this is your first home, my first-time buyer guide covers the full process.

What changes based on your down payment is private mortgage insurance, or PMI. Put down less than 20%, and you'll typically carry PMI, which protects the lender — not you — if you default. Put down 20% or more, and PMI usually isn't required at all.

PMI isn't permanent. Once you've built enough equity in the home — by paying down the loan over time, by the home's value going up, or both — you can ask your servicer to cancel it. Federal law also requires PMI to come off automatically once your loan balance hits a set point, as long as you're current on your payments. The CFPB's explainer on removing PMI walks through exactly how both paths work and what to look for on your PMI disclosure.

Conventional vs. FHA

Both are common, and both work well for different buyers. Here's how they generally compare:

	Conventional	FHA
Mortgage insurance	PMI, only if you're under 20% down	Required on every FHA loan — an upfront premium plus an annual premium
Removing mortgage insurance	Can be cancelled once you've built enough equity	Harder to remove — depending on your down payment, it can last for the life of the loan
Credit flexibility	Generally stricter credit standards	Generally more flexible on lower credit profiles
Property condition standards	More flexible	Stricter — the property has to meet FHA's minimum property standards
Occupancy	Primary homes, second homes, and investment properties	Generally primary residences only
Who it usually suits	Buyers with stronger credit, or who want mortgage insurance they can eventually remove	Buyers who benefit from more flexible credit or down payment requirements

This is a general comparison, not a rule for every situation — which one actually fits you depends on your specific credit, income, and the property you're buying. I'll walk through both with you rather than assume one is automatically better. Read more about FHA loans.

Conventional loans for Florida's specific situations

Condos

Conventional financing on a condo involves a building-level review, not just a review of you as the borrower — lenders look at things like the building's owner-occupancy rate, reserve funds, and whether it's considered "warrantable." A building that doesn't meet those standards can limit your financing options or require a different approach. In Florida, many condo buildings also have to meet state milestone inspection and reserve study requirements, which can affect whether a lender will finance a unit. This is one of the bigger differences buyers run into when they move from shopping single-family homes to shopping condos in the same budget — the building itself becomes part of the underwriting, not just you. I cover condo financing in more detail here.

Second homes and investment properties

Conventional loans can finance a second home or an investment property, which sets them apart from FHA — FHA financing is generally limited to a primary residence. If you're looking at a rental or investment purchase, conventional is usually where that conversation starts, though the underwriting for a non-owner-occupied property looks a bit different than it does for the home you'll actually live in. Read more about DSCR loans.

Insurance costs

Florida's homeowners insurance costs factor into what you qualify for, since your total monthly payment — insurance included — is part of how a lender calculates your loan. A property with high insurance costs, often tied to its flood zone, age, or roof condition, can affect your numbers even when everything else checks out. I'd rather flag that early in your search than have it surprise you after you're already under contract on a specific house.

The homestead exemption

If this will be your primary residence, you can apply for Florida's homestead exemption with your county property appraiser after closing. It's a separate step from your loan, but it affects your property tax bill going forward, which is part of the real monthly cost of owning the home — and something buyers moving to Florida from other states often haven't had to think about before.

What I look at to qualify you

When I'm putting together your conventional loan, I'm looking at a handful of things together, not any single number in isolation:

• Credit. Your credit history and how you've managed debt over time.
• Income and debt-to-income ratio. What you earn, what you already owe, and how a new mortgage payment fits into that picture.
• Assets and reserves. What you have available for your down payment and closing costs, and — depending on the loan — some cushion left over after closing.
• The property itself. The home has to appraise at or above the purchase price and meet Fannie Mae/Freddie Mac's property standards.

A stronger number in one area can sometimes offset a weaker one in another, which is part of why I look at your full picture rather than screening on any single factor. If something in your situation feels complicated — self-employment income, a recent job change, a gift toward your down payment — that's exactly the kind of thing worth talking through early rather than discovering partway into the process.

Questions about conventional loans