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Whether you’re buying your first home or your tenth, chances are you have some questions about home financing. At Closing with Daniel, we’re here to make the process simple, stress-free, and even a little exciting. We love helping homebuyers explore their mortgage options so they can make confident decisions—and save big in the long run.

Here are some of the most common home financing questions we hear. If you’re ready to take the next step, we offer free quotes and prequalification. Wherever you’re looking to buy, we’re ready to help—let’s get started!

What’s the difference between a conventional and a nonconventional loan?

A conventional loan is funded and insured by private lenders, while a nonconventional loan (sometimes called a government-backed loan) is insured by agencies like the FHA (Federal Housing Administration), VA (Department of Veterans Affairs), or USDA (U.S. Department of Agriculture).

Because government-backed loans have added protections for lenders, they tend to have more flexible credit and income requirements. Conventional loans, on the other hand, often require higher credit scores but can come with lower interest rates.

How much do I need for a down payment?

That depends on the loan type!

  • VA and USDA loans – No down payment required.
  • FHA loans – As little as 3.5% down.
  • Conventional loans – Typically 5-20% down, but some programs allow as low as 3%.
  • Jumbo or portfolio loans – May require 10-20% or more.

A larger down payment can mean a lower interest rate and no private mortgage insurance (PMI), but there are plenty of options to buy a home with little money upfront.

What is mortgage insurance, and will I need it?

Mortgage insurance protects your lender in case you stop making payments—it doesn’t protect you as the borrower.

  • Conventional loans require private mortgage insurance (PMI) if you put down less than 20%. The good news? It can be removed once you reach 20% equity.
  • FHA loans require mortgage insurance premiums (MIP) for the life of the loan unless refinanced.
  • VA loans don’t require mortgage insurance at all!

What is a jumbo loan?

A jumbo loan is a mortgage that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac. Since these loans aren’t backed by government-sponsored entities, they typically require higher credit scores, larger down payments, and higher interest rates.

If you’re considering a high-value home, we can help you explore whether a jumbo loan makes sense for your situation.

Is renting cheaper than buying?

Not always! While renting may have fewer upfront costs, owning a home builds equity—meaning you’re investing in your own future instead of your landlord’s.

A mortgage payment can be the same or even lower than rent, especially with today’s loan programs and down payment assistance options. Just keep in mind that as a homeowner, you’ll also need to budget for maintenance, repairs, and insurance.

How can I get started?

We’d love to help! Closing with Daniel is here to answer any lingering questions and guide you through the home financing process. Contact us today for a free consultation and personalized quote—wherever you’re looking to buy!