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. Typically, conventional loans have better rates, terms and/or lower fees than other types of loans.
Fixed Rate Mortgages: The interest rate of a fixed-rate mortgage will not change for the life of the loan.
Adjustable Rate Mortgages (ARM): Adjustable Rate Mortgages (ARM) will be subject to periodical interest rate adjustments based on interest rates around the country.
For Purchase transactions Conventional Loans require the home-buyer to put down at least 5% - 20% 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.