Conventional Loans
Conventional loans in Ohio and Cincinnati — the everyday all-star, from 3% down.
A conventional loan is the mortgage everyone assumes needs 20% down. It doesn't. With solid credit you can buy in Cincinnati with 3% down, and the mortgage insurance you pay for that privilege actually goes away — which is the single biggest difference from FHA. Here's how it works in 2026.
Closings average about 13 days · No SSN or credit pull to start
What "conventional" actually means
A conventional loan is one that isn't insured by the government — no FHA, VA or USDA behind it. Most conventional loans are "conforming," meaning they follow Fannie Mae and Freddie Mac guidelines and stay under the conforming loan limit, which is $832,750 for a single-family home anywhere in Ohio in 2026. Because the loan is sold to Fannie or Freddie, the rules are national, the pricing is competitive, and the private mortgage insurance that covers the lender when you put down less than 20% is priced by your credit score rather than a flat government schedule.
3%
Minimum down, primary residence
620
Credit floor, manual underwriting
$832,750
2026 conforming limit, 1-unit
80% / 78%
PMI cancels: on request / automatically
Sources: Fannie Mae Selling Guide (2026); FHFA conforming limits for 2026; CFPB on the Homeowners Protection Act.
The three ways to get to 3% down
| Program | Who it's for | 2026 rules |
|---|---|---|
| Fannie Mae Standard 97 | First-time buyers of any income | 1-unit primary residence, 30-year fixed, at least one borrower with no ownership in 3 years, homebuyer education required. No high-balance or ARM |
| Fannie Mae HomeReady | Moderate-income buyers, first-time or not | 97% LTV on a 1-unit; income at or below 80% of area median ($87,200 Hamilton County, $89,040 Franklin, $83,120 Cuyahoga, $82,400 Montgomery for 2026); reduced mortgage insurance pricing |
| Freddie Mac Home Possible | Moderate-income buyers | 3% down, 97% LTV (105% with an Affordable Second like OHFA assistance); income at or below 80% AMI |
| Standard conventional | Everyone else | 5% down primary residence; second homes from 10%; investment properties from 15–25% |
The one that surprises people is Home Possible's 105% combined LTV. It means a buyer can put 3% down, take OHFA's 3% conventional assistance as a second lien, and Freddie Mac is fine with the total. That's how a first home in Cincinnati at the $329,450 median closes with roughly $10,000 down and most of it coming from the state.
PMI: the cost that goes away
Put down less than 20% on a conventional loan and you'll pay private mortgage insurance until you build 20% equity. Two things make it different from FHA's premium. First, it's priced by your credit score, your down payment and the insurer — so a 760-score buyer with 10% down pays far less than a 640-score buyer with 3% down. I don't print PMI rates here because they change by lender, by month and by borrower; I price yours on your actual file. Second, it cancels. Under the Homeowners Protection Act you can request cancellation at 80% of your original value, it terminates automatically at 78%, and if your home has appreciated, a new appraisal can get you there years early.
$264,000 loan at an illustrative 6.5%; Hamilton County effective tax rate ~1.44%; Ohio average insurance ~$2,106/yr (2026). At 5% down the loan is $313,500, P&I about $1,981, and a PMI line is added until you reach 20% equity. Not a quote.
The FHA comparison in one line: FHA charges 1.75% upfront plus 0.55% a year for the life of the loan when you put down under 10%. Conventional charges nothing upfront and a credit-based monthly premium that cancels. For a buyer with a 720 score and 5% down, conventional almost always wins over the life of the loan. For a 620 score, FHA usually does. Details on the FHA loans in Ohio page.
Seller credits, by the numbers
Conventional loans let the seller (or builder, or agent) contribute toward your closing costs, prepaids, discount points and even a 2-1 buydown — but the cap depends on how much you put down. Ohio buyers averaged about $3,394 in closing costs in 2025, roughly 1.07% of the price before prepaids, so even the tightest cap has room.
Source: Fannie Mae Selling Guide B3-4.1-02. On a $330,000 purchase with 5% down, the cap is $9,900 — enough for closing costs and a 2-1 buydown.
Where conventional quietly wins
- Appraisal waivers. Fannie and Freddie's automated systems sometimes waive the appraisal entirely on strong files — saving $500 to $700 and a week of schedule. FHA never does.
- Second homes and rentals. FHA is primary-residence only. Conventional finances the Lake Erie cottage, the Hocking Hills cabin, or a single-family rental in Norwood — though for investors qualifying on rent instead of income, a DSCR loan in Ohio is often the better fit.
- Condos. Conventional condo approvals are more flexible than FHA's project-approval process, which matters downtown and in Over-the-Rhine.
- Higher price points. Up to $832,750 with no government insurance — and above it, a jumbo loan picks up.
- Cash-out later. Conventional cash-out refinances go to 80% loan-to-value on a primary residence — see refinancing in Ohio.
- 1 Day 1
The comparison
Your score, down payment and ratios decide conventional vs FHA. I show you both payments the same day.
- 2 Week 1
Pre-approval
Documents reviewed, credit pulled once, automated approval run — sometimes with an appraisal waiver already in hand.
- 3 Under contract
About 13 days
Appraisal (if required), title, final underwriting. My closings average about 13 days from application.
- 4 After closing
Track your equity
I calendar the point where PMI cancellation becomes possible and tell you when a new appraisal is worth ordering.
Rates, points and the honest answer
Conventional pricing moves daily and depends on your credit score, loan-to-value, property type and whether you pay points. I don't publish a rate on this page because a printed rate is wrong within a week and is usually the best-case number, not yours. What I'll do instead is price your actual scenario — with and without points, with and without a seller-paid buydown — and put the options side by side. If a different program wins, I'll say so.
Ohio-specific costs that ride on a conventional loan
Three Ohio facts change the closing table in your favor. First, there is no mortgage recording tax in Ohio — a second-lien or a refinance records for per-page recorder fees, not a percentage of the loan. Second, Ohio's conveyance fee — the state's version of a transfer tax, $3 per $1,000 in Hamilton County (including the $2 county add-on), $4 in Cuyahoga — is customarily paid by the seller, so it rarely lands on a buyer's Closing Disclosure. Third, homeowners insurance is cheap here: about $2,106 a year on average in 2026 versus roughly $2,500 to $2,600 nationally, which matters because the escrow deposit at closing is built from it. Put together, Ohio buyers averaged about $3,394 in closing costs before prepaids in the latest industry report — roughly 1.07% of the price, among the lowest in the country.
Second homes and rentals on conventional financing
Conventional is the only mainstream program that finances a second home or a small rental in your own name. Second homes — a place on Lake Erie, a cabin in Hocking Hills, a condo near family in Columbus — generally start at 10% down and must be a reasonable distance from your primary residence and used by you part of the year. Investment properties start around 15% down for a single-family and more for two- to four-unit buildings, and seller contributions are capped at 2%. Rental income from a lease or an appraiser's rent schedule can help you qualify, but you still qualify on your income and debts. Once you're past a couple of financed properties, or once your tax returns stop reflecting what you actually earn, a DSCR loan that qualifies on the rent alone is usually the cleaner file — and it closes in an LLC, which conventional won't.
Figures current as of September 2026 — programs and limits change; I re-verify everything at application.
Napkin math, upgraded
What's the payment on that house?
Price, down payment, rate and term — plus Ohio taxes and insurance — into one honest monthly number.
Illustrative estimates only — not a rate quote, an offer, or a commitment to lend. Your actual figures depend on your full scenario. More tools on the calculators page.
Real questions
Things people ask Zach about this
How much down do I need for a conventional loan in Ohio?
As little as 3% on a primary residence. Fannie Mae's Standard 97 requires at least one borrower to be a first-time buyer (no ownership in the last three years); HomeReady and Freddie Mac's Home Possible drop that requirement but cap income at 80% of area median — $87,200 in Hamilton County for 2026. Above those, 5% down is standard. Second homes generally start at 10% and investment properties at 15% to 25%.
What credit score do I need?
620 is the manual-underwriting floor for a fixed-rate conventional loan. Automated approvals through Fannie Mae's system don't publish a fixed minimum, but pricing improves in steps as your score rises, and mortgage insurance gets noticeably cheaper above roughly 700 and again above 740. If you're at 660, the honest comparison is usually conventional versus FHA on the same day — the answer changes with your score.
When does PMI go away on a conventional loan?
By federal law you can request cancellation once your balance reaches 80% of the home's original value (with a good payment history and no second liens), and the servicer must cancel it automatically at 78% if you're current. It also has to end at the loan's midpoint regardless. With Cincinnati prices, many buyers get there in four to seven years through a mix of principal paydown and appreciation — or sooner with a new appraisal.
What is the 2026 conforming loan limit in Ohio?
$832,750 for a single-family home in every Ohio county for 2026, up from $806,500 in 2025. Two-unit properties go to $1,066,250, three units $1,288,800 and four units $1,601,750. Anything above those is a jumbo loan. Since Cincinnati's July 2026 median sale price was $329,450, the limit is rarely a factor here — in California it's a different story.
Can the seller pay closing costs on a conventional loan?
Yes, within caps set by your down payment: up to 3% of the price if you put down less than 10%, 6% between 10% and 25% down, and 9% at more than 25% down. Investment properties are capped at 2%. Those contributions can cover closing costs, prepaids, discount points and a temporary buydown — anything above the cap is treated as a price reduction instead.
Is conventional better than FHA for me?
Usually yes if your credit score is 700 or higher and you have at least 5% down: cheaper mortgage insurance that cancels, no upfront premium, and no life-of-loan insurance. Usually no if your score is under about 680 or your debt ratio is above 45%, where FHA's flat pricing and flexibility win. In the middle I price both on the same afternoon. There's no loyalty to a program here — only to the lower payment.
Keep reading
Related lending
FHA loans in Ohio — the alternative when credit or ratios are tight →First-time buyer programs in Ohio — OHFA's 3% conventional assistance →Jumbo loans in Ohio and California — above the $832,750 line →2-1 buydowns in Ohio — a seller credit that lowers your first two years →Refinancing an Ohio home — dropping PMI and resetting the rate →Where Zach lends
Conventional loans across Ohio & California
No pressure, no credit pull
Run your conventional loan scenario by Zach.
Send the shape of it — what you’re buying, roughly what you earn, where you’re at. Zach reads every one personally and gets back to you the same day, nights and weekends included.
Nothing sensitive lives on this form: no Social Security number, no paperwork, and your credit isn’t touched until you say so. Equal Housing Opportunity. Zachary Bates, NMLS #2687902 · Coast 2 Coast Mortgage, NMLS #376205.