Conventional loans are the most common type of mortgage in the United States. They are not insured or guaranteed by the federal government, which means they follow private‑lender guidelines rather than the rules that apply to FHA, VA, or USDA loans.

Pros

  • Lower down‑payment options – many lenders accept as little as 3% of the home’s price, making it easier for first‑time buyers to get into a home.
  • Flexibility – you can use a conventional loan for a primary residence, a second home, or an investment property.
  • No upfront mortgage insurance premium – unlike FHA loans, there is no government‑mandated insurance fee at closing.
  • Potentially lower overall cost – if you can put at least 20% down, you avoid PMI, which can reduce monthly payments.

Cons

  • Stricter credit standards – lenders typically require a credit score of 620 or higher, and a strong credit history can affect the interest rate you receive.
  • PMI requirement – if you put down less than 20%, you’ll pay private mortgage insurance until you reach that equity level.
  • Higher down‑payment for the best rates – borrowers who can afford 20% down usually qualify for the most competitive interest rates.
  • Less forgiving of high debt‑to‑income ratios – most lenders cap the DTI around 45%, which can limit borrowers with significant existing debt.

New Hampshire Specific Considerations

  • Closing is often handled by a real‑estate attorney rather than a title‑company, which can add a layer of legal review to the process.
  • The state offers first‑time‑buyer assistance programs through the New Hampshire Housing Finance Authority that can help with down‑payment grants or low‑interest loans, complementing a conventional loan.
  • New Hampshire has no broad-based state income tax, which can affect your overall tax picture but does not directly impact the loan itself.

This article provides general information about conventional loans for New Hampshire homebuyers and is not personalized financial or legal advice. You should consult a qualified mortgage professional or attorney for advice tailored to your situation.