Conventional Loan Options in Virginia With Less-Than-Perfect Credit

Conventional Loan

Conventional Loan Options in Virginia With Less-Than-Perfect Credit

Reviewed by the HomeMath editorial team Updated 2026-08-06

Key takeaways

Credit scores as low as 620 can qualify for conventional loans, but lower scores may need compensating factors.
Minimum down payment is typically 3% for first‑time buyers and 5% for other borrowers; larger down payments improve approval odds with imperfect credit.
Private mortgage insurance (PMI) is required when the down payment is under 20%, and the cost can be higher for lower credit scores.
Virginia often requires an attorney to handle the closing, and the state offers a first‑time homebuyer assistance program that can be combined with a conventional loan.

Conventional loans are a popular choice for homebuyers in Virginia, even when credit isn’t perfect. Lenders look at the whole financial picture, so understanding the key requirements can help you position yourself for approval.

Credit Score Requirements

Most conventional lenders set a baseline credit score around 620. Below that, you’ll need additional strengths in your application, such as a larger down payment, significant cash reserves, or a co‑signer. The score threshold exists because it gives lenders a statistical gauge of repayment risk.

Down Payment Options

Virginia borrowers can usually put down as little as 3% if they qualify as first‑time homebuyers, or 5% for other applicants. A higher down payment reduces the loan‑to‑value ratio, which offsets credit risk and can lower your interest rate and PMI costs.

3% down – often paired with first‑time buyer programs.
5% down – standard minimum for most conventional loans.
10% + down – improves approval chances and may eliminate PMI.

Private Mortgage Insurance (PMI)

When your down payment is under 20%, lenders require PMI to protect themselves against default. Borrowers with lower credit scores typically pay a higher PMI premium because the perceived risk is greater. PMI is usually cancellable once you reach 20% equity.

Virginia‑Specific Considerations

Virginia commonly uses attorney‑facilitated closings rather than title companies, which can affect timing and fees. Additionally, the state’s Virginia Housing program offers down‑payment assistance and favorable loan terms that can be stacked with a conventional loan, helping borrowers with less‑than‑perfect credit.

Tips for Strengthening Your Application

Save for a larger down payment to offset credit weaknesses.
Pay down existing debt to improve your debt‑to‑income ratio.
Consider a co‑signer with strong credit.
Gather documentation of stable employment and cash reserves.

This article provides general information and should not be taken as personalized financial advice.

FAQ

Can I get a conventional loan with a credit score below 620?

Some lenders may consider scores below 620, but they will typically require compensating factors such as a larger down payment, strong cash reserves, or a co‑signer. The lower the score, the more additional strength you’ll need to demonstrate.

Do I have to pay private mortgage insurance if my credit is low?

PMI is required whenever the down payment is under 20%, regardless of credit score. However, borrowers with lower scores often face higher PMI rates because the insurer views the loan as riskier.

How does Virginia’s attorney‑closing process affect my loan?

In Virginia, an attorney usually prepares and reviews the closing documents, which can add a layer of legal oversight. This may increase closing costs slightly but also helps ensure that the transaction complies with state laws and protects both parties.

Can I combine Virginia’s first‑time homebuyer assistance with a conventional loan?

Yes, many of Virginia’s assistance programs, such as those offered through Virginia Housing, can be paired with a conventional loan. These programs may provide down‑payment grants or favorable loan terms that help offset credit challenges.

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