These are also called as conforming loans and the most common type of loans in the mortgage industry. These loans are for $417,000 or less. The two main categories of loans are – fixed rate and adjustable rate (also know as ARM’s). Good credit score (FICO score of 740 and above) and down payment of more than 20% are required to get competitive rates. These loans are available with or without closing costs and with or without points.

These loans also called non-conforming loans and the amount is more than $417,000. Good credit score (FICO score of 740 and above) and down payment of more than 25% of the purchase price or value of the home are required to get competitive rates. These loans are also available with or without closing costs and with or without points.

These loans are backed by Department of Housing and Urban Development. The Federal Housing Administration (FHA) – which is part of HUD – insures the loan, so your lender can offer you a better deal.

• Low down payments (as low as 3%).
• Low closing costs (seller can contribute up to 6% of the purchase price to the buyer towards closing costs).
• Easy credit qualifying.

These are similar to FHA loans except that they are backed by the Veteran Administration department of the federal government and you have to be a qualified veteran.