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Conventional loans dominate Reedley's housing market because they work for both first-time buyers and move-up purchasers. Most properties in Fresno County fall well below conforming limits, making conventional financing the most straightforward path to homeownership.
Unlike government-backed loans, conventional mortgages let you avoid upfront funding fees and drop PMI once you hit 20% equity. In Reedley's stable market, that matters more than the slightly higher credit score requirement.
We close conventional loans here faster than FHA because fewer appraisal restrictions come into play. Reedley's housing stock is newer than surrounding farm communities, which helps conventional underwriting move smoothly.
Conventional Loans in Reedley
You need 620 credit minimum, but 680+ gets you better pricing tiers. Most of our Reedley borrowers land conventional approval with 5% down if their credit sits above 700.
Debt-to-income caps at 50% with strong compensating factors like reserves or high credit scores. Self-employed borrowers qualify using two years of tax returns showing stable income.
Down payment can come from gifts, grants, or your own funds. We see Reedley buyers use USDA grants for down payment assistance, then layer a conventional mortgage on top for better overall terms.
Local decision guide
Use this guide to connect conventional loans eligibility, lender expectations, and local market factors before comparing payment options in Reedley.
Conventional loans dominate Reedley's housing market because they work for both first-time buyers and move-up purchasers. Most properties in Fresno County fall well below conforming limits, making conventional financing the most straightforward path to homeownership.
Unlike government-backed loans, conventional mortgages let you avoid upfront funding fees and drop PMI once you hit 20% equity. In Reedley's stable market, that matters more than the slightly higher credit score requirement.
We close conventional loans here faster than FHA because fewer appraisal restrictions come into play. Reedley's housing stock is newer than surrounding farm communities, which helps conventional underwriting move smoothly.
We shop your conventional loan across 200+ wholesale lenders who compete for Reedley business. Credit unions price aggressively here, but portfolio lenders sometimes beat them on borderline files.
Rate spreads between lenders hit 0.5% on identical scenarios. A broker saves you money because we see real-time pricing across the entire wholesale market, not just one bank's rate sheet.
Fresno County properties appraise cleanly for conventional loans, so lenders don't add overlays. The challenge is finding who prices your specific credit and down payment profile best.
Conventional loans beat FHA in Reedley unless your credit sits below 640. The monthly savings from lower mortgage insurance outweigh the higher down payment within three years of ownership.
Most Reedley buyers overpay for interest rate by ignoring points strategy. Buying down rate makes sense if you plan to stay five years; otherwise take lender credits and pocket the savings.
We lock rates when you're in contract, not at pre-approval. Reedley transactions close in 30-35 days typically, so early locks just cost you money in extended rate lock fees.
FHA loans make sense under 640 credit or with 3.5% down, but conventional wins for everyone else in Reedley. You avoid the lifetime mortgage insurance FHA charges on low down payment loans.
Jumbo loans don't apply to Reedley since the 2026 conforming limit is $832,750 and local prices run well below that threshold. Stick with conventional to access the best rate pricing.
Adjustable rate mortgages price 0.75% below fixed conventional right now. That works if you're relocating within five years, but Reedley buyers typically stay longer, making fixed rates safer.
Reedley sits in unincorporated Fresno County pockets where well water and septic systems appear on older properties. Conventional lenders require well tests and septic inspections, adding $600-800 to closing costs.
Agricultural zoning affects some Reedley properties, but conventional lenders approve residential structures on ag land if you're not farming commercially. We route those files to rural property specialists.
Appraisers pull comps from Dinuba and Parlier when Reedley inventory runs thin. This rarely kills deals, but it can slow conventional appraisals by 5-7 days during busy seasons.
Minimum 620, but 680+ unlocks better rate pricing. Most Reedley approvals happen at 700+ credit with competitive terms.
Yes, conventional loans accept 5% down with PMI. You'll drop PMI automatically once you reach 20% equity through payments or appreciation.
Yes, but lenders require well water tests showing potability. Budget $400-600 for testing and expect a 3-5 day delay for lab results.
Conventional PMI costs less monthly and cancels at 20% equity. FHA charges lifetime insurance on loans under 10% down, making conventional cheaper long-term.
Conforming limit is $832,750 in 2026. Reedley prices run well below this, so conventional loans cover virtually all local properties.
Typically 30-35 days from contract to closing. Rural appraisals on properties with wells or septic can add 5-7 days to the timeline.