Conventional Loan
A conventional loan is a type of mortgage not backed by a government agency like the Federal Housing Administration (FHA) or the Department of Veterans Affairs (VA). Instead, these loans are financed and insured by private lenders, making them subject to stricter qualification requirements, including a solid credit history and a more substantial down payment. Conventional loans come in various forms, such as fixed-rate and adjustable-rate mortgages, and offer flexibility in terms of loan duration. Borrowers who meet the credit and financial criteria typically benefit from competitive interest rates, but they must also assume a greater share of the lending risk. Conventional loans are commonly utilized for purchasing or refinancing primary residences, investment properties, or second homes, offering a versatile solution for a wide range of real estate needs.