Step 12 of 48 Phase 2: Assess Your Buying Power
2.5 Types Of Mortgages
Learn about the different types of mortgages available to homebuyers.
Mortgage Types
| Type | Best For | Key Features |
|---|---|---|
| Conventional | Good credit, 20% down | No PMI with 20% down |
| FHA | First-time buyers | Low down payment (3.5%) |
| VA | Veterans/Military | No down payment required |
| USDA | Rural areas | No down payment, income limits |
Common Mistakes to Avoid
- Choosing an FHA loan when you qualify for conventional - FHA has lifetime mortgage insurance on some loans
- Picking an ARM just for the lower initial rate without planning for rate adjustments
- Not exploring VA or USDA loans if you qualify - they offer significant benefits
- Assuming the loan type your friend used is the best choice for your situation