Conventional 97 Loan Requirements at a Glance
The Conventional 97 loan is a low-down-payment mortgage option from Fannie Mae, designed for first-time home buyers. The program lets eligible buyers make a 3% down payment on a single-family primary residence.
First-Time Home Buyer Requirement
To use a Conventional 97 loan, at least one borrower must be a first-time home buyer. A first-time home buyer is anyone who has not owned a residential property in the last 36 months. People who previously owned a home and rented for the last 3 years are eligible as first-time buyers.
The first-time home buyer rule applies to partial homeownership, too.
If your name has been on the title for any home, the 36-month window begins when the home is sold or you are removed from title.
If you meet the first-time buyer rule, the next step is figuring out how much you’ll need for your down payment and closing costs. See our Down Payment & Closing Costs Guide for exact amounts and eligible funding sources.
Minimum Credit Score Requirements
The minimum credit score for a Conventional 97 loan is 620. If your credit score is over 740, you may get access to a lower interest rate or pay less for your private mortgage insurance (PMI).
Some buyers do not have a traditional credit score. In these cases, lenders may accept non-traditional credit history, such as records of on-time rent, utility, or insurance payments. If you require non-traditional credit, check with your lender to see if it’s an option.
If not, try Another Lender. If you’re deciding between Conventional 97 and FHA because of your credit score, read Conventional 97 vs FHA: Which Is Better for First-Time Buyers? for side-by-side differences.
Income Rules
The Conventional 97 mortgage program does not enforce income limits. Unlike HomeReady or Home Possible, Conventional 97 is available to buyers at any income level.
Debt-to-income ratio (DTI) is considered as part of the approval process. Most lenders will allow a DTI up to 45% with Conventional 97, and some may approve a higher DTI if you have strong compensating factors.
For more on how income fits into the full approval picture, see our Conventional 97: Complete Guide.
Property Type Rules
Eligible property types for Conventional 97
The Conventional 97 can be used to buy or refinance a single-family home, whether detached or attached. Condos are also eligible, but condos must be warrantable—approved by Fannie Mae. Townhomes and rowhomes qualify as well. Manufactured homes may be allowed if the property meets Fannie Mae's construction, foundation, and HUD code requirements.
Ineligible property types for Conventional 97
Conventional 97 loans are not available for multi-unit properties like 2-unit, 3-unit, or 4-unit homes. It also cannot be used for investment properties, second homes, or short-term rentals.
Conventional 97 Eligible and Ineligible Property Types
| Property Type | Eligible for Conventional 97? | Notes |
|---|---|---|
| Single-family home (detached) | Yes | Most common; must be primary residence |
| Single-family home (attached) | Yes | Includes townhomes and rowhomes; must be primary residence |
| Condo (warrantable) | Yes | Condo must meet Fannie Mae warrantable standards |
| Manufactured home | Yes | Allowed if property meets Fannie Mae and HUD requirements |
| 2-4 unit property | No | Multi-unit homes are not eligible |
| Investment property | No | Only primary residences qualify |
| Second home | No | Not allowed under Conventional 97 |
| Short-term rental | No | Not eligible |
If you’re comparing property eligibility rules with FHA loans, our Conventional 97 vs FHA guide covers the differences in detail.
Key Takeaway
Conventional 97 loans are built for first-time buyers who have good credit and want to buy a primary residence with just 3% down. If you meet the credit, ownership history, and property requirements, it’s one of the most accessible conventional mortgage options available. And if you’re getting help from family or friends with your down payment, see Gift Funds for Conventional 97 for the rules and documentation you’ll need.
Frequently Asked Questions About Conventional 97 Loan Requirements
Find answers to common questions about Conventional 97 credit score, down payment, and eligibility rules.
What is the minimum credit score for a Conventional 97 loan?
The minimum credit score is 620. Higher scores can result in better interest rates and lower PMI costs.
Do I have to be a first-time home buyer to use Conventional 97?
Yes. At least one borrower must be a first-time home buyer, meaning you haven't owned a residential property in the last 36 months.
Are there income limits for Conventional 97?
No. Unlike HomeReady or Home Possible, Conventional 97 has no income restrictions.
Can I buy a multi-unit property with Conventional 97?
No. The program is only for one-unit primary residences, such as a house, condo, or eligible manufactured home.
Are manufactured homes eligible for Conventional 97?
Yes, but only if they meet Fannie Mae's requirements for construction, foundation, and HUD certification.
Can I qualify for Conventional 97 without a credit score?
It's possible in some cases by using non-traditional credit history, but eligibility will depend on the lender's underwriting guidelines.
