The Conventioanl loan is not secured by a government entity but rather meets the lending requirements of Fannie Mae and Freddie Mac.
This type of loan is ideal for Borrowers with good or excellent credit and can be used to purchase or refinance existing home loans. These are traditional loans that can carry a 30 year fixed rate or a variable rate such as a 5/1 ARM.
Down payments for Conventionl loans are typically 5% down for Single Family homes. Loans that carry a 20% down payment have the added advantage of no Private Mortgage Insurance premiums (PMI). These loans have more restrictive guidelines as compared to FHA.