The term "conventional" refers to loans that adhere to guidelines set forth by Fannie Mae and Freddie Mac. These two large agencies create a secondary market for mortgage backed securities by backing loans with an insurance policy that makes them attractive to large investors across the globe.

Credit score is an important factor that helps determine what type of loan you might qualify for. For conventional loans, your median credit score is required to be above 620. They take the middle score reported by each of the credit reporting agencies, and use that to determine your eligibility.

Conventional loans require a minimum down payment of 3%. It’s a common misconception that you have to have a full 20% down payment to qualify for a conventional loan, and this simply isn’t true.

Less demanding eligibility requirements make FHA loans some of the most accessible loans to get. It's a popular loan option for first time home buyers and credit-challenged borrowers.

These loans are some of the most appealing because they require a small down payment for most borrowers, tend to have better interest rates than standard conventional loans, and have fewer restrictions on low credit scores and recent bankruptcies or foreclosures.

When you borrow money to buy your home with an FHA loan, you pay mortgage insurance. It's like the private mortgage insurance you'd pay on a conventional loan if you put less than 20% down, but unlike conventional loans, you can't get rid of the MIP when you pay your loan down below 78%. MIP for an FHA loan is there for the life of the loan.

A VA home loan is a loan program designed to make it easier for veterans, active military members, and eligible family members to buy a home.

VA loans are funded by independent VA-approved banks and lenders and guaranteed by the Department of Veterans Affairs. Because of this guarantee, VA loans can offer attractive terms other loans can't, such as a zero down payment requirement, and no monthly mortgage insurance.

Eligible veterans who may not have been able to qualify for more stringent loan programs, can still enjoy owning a home, and often save a substantial amount of money in the process. Some benefits include: no mortgage insurance, no down payment, easier to qualify than conventional loans, very low interest rates, lenient credit standards and higher debt to income ratio approvals.

The United States Department of Agriculture (USDA) loan (also called the USDA Rural Housing Development Guaranteed Housing Program) is a government-issued 100% financing program designed to boost the economy and quality of life in rural areas.

As you can imagine, a loan intended to improve life in rural and suburban areas is best suited for people trying to buy a home in those areas. It's not just the person who has to qualify for financing; the house's location matters and must be in an area considered rural.

A jumbo loan is a type of financing that exceeds the limits set by the Federal Housing Finance Agency (FHFA). Unlike conventional mortgages, a jumbo loan is not eligible to be purchased, guaranteed, or securitized by Fannie Mae or Freddie Mac. Designed to finance homes in highly competitive real estate markets, jumbo mortgages come with stricter requirements. Homeowners must undergo more rigorous credit requirements than those applying for a conventional loan. Approval often requires a stellar credit score and a low debt-to-income ratio.

The value of a jumbo mortgage varies by state—and even county. The FHFA sets the conforming loan limit size for different areas on an annual basis.

For borrowers who might struggle with conventional loan approval, there are alternative options. These include non-conforming loans, stated income loans, Alt-A loans, portfolio loans, and more. For the right borrower, a good alternative loan can provide options where a conventional loan would not.

Atypical buyers can include people who are self-employed, get their income from unique sources, don’t have established credit or have other life circumstances that make getting a traditional loan difficult.