Florida First-Time Home Buyer Program — 3% Down Conventional

You can buy with 3% down using conventional financing as a first-time home buyer — sometimes even 1% down. Most people think first-time buyer programs mean FHA or USDA, but conventional financing has real advantages: no guarantee fee, mortgage insurance that falls off at 78% LTV, and competitive rates.

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3% Down (or Less)

Buy with as little as 3% down as a first-time buyer — and in some scenarios, just 1% down. Lower than FHA’s 3.5%.

No Guarantee Fee

FHA adds 1.75% to your loan ($3,500 on a $200K loan). USDA adds 1%. Conventional has no guarantee fee at all.

MI Falls Off at 78%

Conventional mortgage insurance drops off automatically at 78% LTV — FHA and USDA stay for the life of the loan.

Do I Qualify as a First-Time Home Buyer?

Most of the time, people think of government programs when it comes to being a first-time home buyer. You can, however, utilize conventional financing with as little as 3% down as a first-time home buyer. Other programs allow for 3.5% down through FHA or $0 down with USDA, but there can be disadvantages to those programs in comparison to conventional financing.

If you have not owned a home in the last 3 years, then yes — you would qualify as a first-time home buyer. Qualifying as a first-time home buyer means you can utilize conventional financing with as little as 3% down. If you have owned property within the last 3 years, then the lowest down payment you would be eligible for utilizing conventional financing would be 5% down. If you have owned within the last 3 years and you don’t have the 5% down payment required for conventional, we’d recommend applying for an FHA or USDA mortgage instead.

How Does Conventional Financing Compare?

Conventional financing for a first-time home buyer can have real advantages over government programs. If a borrower utilizes FHA or USDA financing (which they can use even if they aren’t a first-time home buyer), there will be a guarantee fee that gets added to the loan. So if the base loan amount is $200,000, with an FHA loan it would increase to $203,500 to cover that fee. With USDA it would go to $202,000. There is no guarantee fee built into conventional financing.

What About Mortgage Insurance?

Unless you are putting 20% down utilizing conventional financing, there will be some kind of mortgage insurance to pay in case of default. With FHA financing the mortgage insurance is 0.85% no matter what the loan amount is, up to the FHA loan limit for your county. With USDA financing it’s 0.35% — USDA is a great program for first-time home buyers, but it has geographic and household income restrictions.

Mortgage insurance rates for conventional financing are driven by credit score and loan-to-value ratios. The higher the credit score and the lower the LTV, the lower the mortgage insurance rate will be. And — unique to conventional — the MI is not for the life of the loan like FHA or USDA. When you reach 78% LTV it falls off automatically. That alone makes conventional an outstanding feature for first-time home buyers.

What’s the Minimum Credit Score?

The minimum credit score for conventional financing is 620. Your interest rate and mortgage insurance rate will be driven by your credit score. Like with any loan program, the higher your credit, the better your interest rate — but unique to conventional financing, the higher your credit score, the lower your mortgage insurance will be as well. This can range quite a bit, so reach out to us for a mortgage insurance quote. If your credit is good, your conventional MI can be less than FHA’s flat 0.85%. If your credit score is low, it could be higher.

Keep in mind: MI with FHA is for the life of the loan; it falls off with conventional. In typical markets, FHA and USDA minimum credit scores are lower than 620. In those cases a government loan program could be better for you. FHA financing can also allow for higher debt-to-income thresholds.

Seller Concessions for First-Time Conventional Buyers

For first-time home buyers, it’s common to ask the seller to help contribute to your closing costs and pre-paids. Pre-paids are things like your costs for homeowners insurance and property taxes. If you are putting down less than 10% utilizing conventional financing, you can ask for up to 3% of the sales price to go toward your closing costs. This may or may not cover all of your closing costs — be aware of what they are before you put an offer in. Typically, on a $200,000 house, 3% will cover all of the closing costs and pre-paids, but it depends on each individual property and buyer.

Hometown Heroes Pairing

If you’re a licensed professional in Florida — a first responder, nurse, teacher, massage therapist — it’s possible you could qualify for the Hometown Heroes Program. With Hometown Heroes, up to 5% of the sales price can go toward your down payment or closing costs, so you might not need seller concessions at all. There are too many qualifying professions to list here, but reach out and we’ll check your eligibility.

How We Help First-Time Florida Buyers

Conventional 3% down financing for first-time buyers (1% down available in some scenarios)
3-year rule check — confirm your first-time buyer status
FHA / USDA / conventional comparison run for your specific scenario
Mortgage insurance quotes by credit score and loan-to-value
Seller concession strategy — up to 3% of sales price toward closing
Hometown Heroes pairing for eligible professions (up to 5% toward down payment)
620 minimum FICO accepted on conventional
Strategy for when MI is set to fall off at 78% LTV
DTI guidance — when FHA’s higher thresholds make sense over conventional
24-hour pre-approval on weekdays so you can shop with confidence

Conventional First Time Buyer FAQ

If you haven’t owned a primary residence in the last 3 years, you qualify as a first-time home buyer for conventional 3% down financing. Even if you owned a home 5 or 10 years ago and rented since, you’re back to first-time buyer status.

Three reasons. One: conventional has no upfront guarantee fee — FHA adds 1.75% to your loan amount, so on a $200K loan FHA’s actually $203,500. Two: conventional MI falls off at 78% LTV; FHA MI stays for the life of the loan. Three: with strong credit, conventional MI can be cheaper than FHA’s flat 0.85%. The catch is conventional needs a 620 minimum FICO; FHA can go lower.

If you’ve owned within the last 3 years, your minimum down payment on conventional is 5% instead of 3%. If you don’t have 5% saved, FHA at 3.5% or USDA at 0% may be the better path. We’ll run all three scenarios for you.

In some scenarios, yes. There are 1% down conventional programs where the lender contributes 2% to bring you to the 3% threshold. Eligibility depends on income, area, and credit profile — let us check your scenario.

Yes. Under the Home Owners Protection Act, conventional MI is required to be removed automatically at 78% loan-to-value. You can also request cancellation at 80% LTV. FHA and USDA mortgage insurance is for the life of the loan — the only way out is a refinance.

If you’re putting less than 10% down on conventional, the seller can contribute up to 3% of the sales price toward your closing costs and pre-paids (homeowners insurance, property taxes). On a $200K house, 3% will typically cover everything — but every property is different, so check the numbers before you write the offer.

Yes — if you work in an eligible profession (first responder, nurse, teacher, licensed professional, etc.), Hometown Heroes can contribute up to 5% of the sales price toward your down payment or closing costs on top of conventional financing. That can bring your out-of-pocket close to zero.

620 minimum FICO for conventional. Your interest rate and your mortgage insurance rate are both driven by your credit — higher score, lower rate, lower MI. Below 620 we’d shift you to FHA, which has a lower minimum FICO but flat 0.85% MI for the life of the loan.

About the Author

Keith Meredith

Division President, Black Rock Mortgage
NMLS 303217 · 16+ years originating · $100M+ in mortgages closed

Keith Meredith is a 16 year mortgage industry expert who has originated over $100,000,000 in mortgages. Headquartered in Ocala, Florida, Keith runs Black Rock Mortgage as a division of Coast 2 Coast Mortgage, a lender licensed in 40 states. Keith specializes in manufactured home financing, self-employed mortgages, VA construction loans, and helping first-time buyers navigate FHA, USDA, and conventional programs. He creates written and video content to help borrowers understand their financing options.

Call or text directly: 352-619-4959 · Follow Keith on X, Facebook, Instagram, and LinkedIn

Buy Your First Florida Home With 3% Down

Send us your scenario — purchase price, down payment available, FICO, and whether you’ve owned in the last 3 years. We’ll run conventional, FHA, USDA, and Hometown Heroes side-by-side and tell you which loan program saves you the most. On weekdays we review applications within 24 hours or less.