Conventional Loans are mortgage loans that are not insured by the government (like FHA, VA, USDA Loans), but they typically meet the lending guidelines that have been set by Fannie Mae or Freddie Mac. Conventional loans tend to be ideal for borrowers with excellent credit and at least a 5% down payment.
Fixed Rate Mortgages: Your rate and payment never change.
Adjustable Rate Mortgages: Fixed rate initially, then adjusts either annually or semi-annually.
For Purchase transactions Conventional Loans require the homebuyer to put down a minimum of 3% of the purchase price of the home.
Most conventional loan programs allow you to purchase single-family homes, warrantable condos, planned unit developments, and 1–4 family residences. A conventional loan can also be used to finance a primary residence, second home, and investment property.