Conventional loans are the go-to choice for many home buyers today. They offer great rates, many down payment options, and flexible terms. Many conventional loans are often known as “conforming loans” because they conform to lending standards and offer the following advantages:

• Down payments as low as 3%

• No upfront/monthly mortgage insurance with a down payment of 20% or more

• Available for a primary residence, a second home, or investment property

• Fixed and adjustable rates are available with many loan lengths, typically between 10 and 30 years

• Unlike FHA, mortgage insurance goes away with 20% home equity

• Loan amounts up to $766,550 and more in high-cost counties

FHA loans are the “go-to” loan for 40 percent of today’s younger home buyers. Their popularity is understandable. With small down payment requirements, ultra-lenient credit score standards, and flexible income guidelines, the FHA mortgage makes homeownership available to many buyers. Benefits include:

• 3.5% down payment requirement

• Credit scores as low as 580 for the minimum down payment

• Down payment gifts can cover 100% of the down payment and closing costs

• Lenient income qualification

Home buyers with eligible military service history can qualify for a 100% (zero-down) loan backed by the U.S. Department of Veterans Affairs. This option offers lower rates than “standard” loans; no monthly mortgage insurance is required. Buyers with any type of U.S. military service background should consider this loan first. Advantages include:

• Very low mortgage rates

• 15- and 30-year fixed loans available

• Absolutely no down payment is required

• No mortgage insurance

• Very lenient about credit scores

The USDA mortgage is known by many names: the Rural Development (RD) loan, the Single Family Housing Guaranteed program, or, most commonly, the USDA loan.

This product targets home buyers who plan to live in rural and suburban areas. It offers zero down payment loans to moderate-income applicants. Some highlights:

• Low mortgage insurance fees

• Lenient credit score and income requirements

• Applicants must meet income limits

• Must be a home within USDA-eligible areas (about 97% of U.S. land mass)

Plan to live in your home less than 10 years? An adjustable-rate mortgage (ARM) might be right. These loans come with lower rates than the 30-year fixed option. Yet, the rate is still fixed for a certain amount of time — usually 5, 7, or even up to ten years. It saves the buyer considerable amounts over that time. Plus, it comes with built-in safeguards — called “caps” — that limit the amount the rate can rise after the initial period.

• Get an ultra-low rate for up to 10 years

• The loan starts off with a fixed rate, then adjusts

• Saves thousands in interest over the first few years of the loan

• Allows enough time to sell the home or refinance before the first adjustment

What if it is an expensive area? Conventional loans generally allow generous loan limits up to $726,200 — and higher in many areas — but even that amount is not enough in some high-cost communities. A non-conforming loan, also known as jumbo financing, falls outside of many stated loan limits.

• Mortgage rates comparable with those of conforming loans

• Fixed rates and ARMs available

• Loan amounts in the millions are common