Conventional mortgages are the most common type of loan option, the traditional fixed-rate mortgage includes monthly principal and interest payments which never change during the loan’s lifetime.

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This mortgage does not have government backing, such as from the Department of Veterans Affairs. Conventional mortgages often meet the down payment and income requirements set by Fannie Mae and Freddie Mac, and conform to the loan limits set by the Federal Housing Finance Administration, or FHFA.

You'll generally need a credit score of at least 620 to qualify for a conventional loan, though a score that's above 740 will help you get the best rate. Depending on your financial status and the amount you're borrowing, you may be able to make a down payment that's as low as 3% with a conventional loan.

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Other facts to know about Conventional Mortgages

It's important to note that you may need to pay for private mortgage insurance if you make a down payment of less than 20%. This insurance protects the lender in case you default on the loan.

In addition to the private mortgage insurance, conventional loans also require closing costs, which can range from 1% to 5% of the loan amount. These costs include items such as a home appraisal, credit report, and title search.

Conventional mortgages also come with flexible repayment options such as 15-year and 30-year fixed-rate mortgages, as well as adjustable-rate mortgages (ARMs). These loans may offer lower interest rates and monthly payments, but may also require additional payments if rates increase in the future. It's important to consider the pros and cons of each loan type before making a decision.

(Although be aware that a higher down payment may help get you a lower rate.)

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FHA Mortgage Loans are another option