Conventional

Conventional loans have a 30 year fixed rate but other terms such as a 15 year or an adjustable rate mortgage that has a fixed rate for several years are available as well. If the loan is a 30 year fixed rate, which means the loan’s interest rate will not change for the 30 year term of the loan.

Conventional loans require as little as 5% down. If the borrower provides a down payment less than 20% of the sales price, mortgage insurance will be required. Mortgage insurance is either a monthly or one time premium that is paid to protect the lender in instances where the borrower forecloses. With a down payment of 20% or more, no mortgage insurance is required.