How a First-Time Buyer Used a Conventional Loan to Buy a Townhome with Just 3% Down
- By Jim Blackburn
- on
Client Profile
- Name: Emily R.
- Age: 28
- Profession: Graphic Designer
- Location: Raleigh, NC
- Income: $68,000/year
- Credit Score: 720
- Loan Type: Conventional 97 (First-Time Buyer Program)
- Down Payment: 3% ($8,700 on a $290,000 purchase)
The Challenge
Emily had a stable job, decent credit, and had been renting for five years. She was tired of paying her landlord’s mortgage and wanted something of her own—but she assumed she needed 20% down, which seemed impossible while paying student loans and saving monthly.
After finding a townhome in a safe, up-and-coming neighborhood near her job, she reached out to our team to explore her options.
The Strategy
We showed Emily how she qualified for a Conventional 97 loan, which only required 3% down because she was a first-time buyer.
Other key benefits:
- No upfront mortgage insurance like FHA
- She could cancel PMI after reaching 20% equity
- Better long-term savings compared to an FHA loan over 7+ years
- Seller paid 2% of her closing costs, lowering her out-of-pocket total to under $11K
The Outcome
Emily closed in 27 days, moved in on a Saturday, and hosted friends the next weekend.
Her mortgage payment was $150/month less than her previous rent, and she now owns a home that’s already appreciated $15,000 in 12 months.
Quote from Emily:
“I honestly didn’t think I could buy a home until my 30s. I thought 20% down was required. I’m so glad I asked the question—now I tell all my friends to look into this.”
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