Good guys v.s. Bad Guys

[Duane Hill]

So I live in Ohio and am completely new to the real estate world. Im under contract right now, trying to buy my first property ever. Which is a duplex btw. I was approved for a conventional loan with a 3.5% interest rate a month and a week ago from today. Out of nowhere my "mortgage broker" tells me that im only approved for an FHA loan and if i switched to a conventional loan my interest rate would go up and I would need 15% down on the loan. Is this even legal???