Conventional loans.

A conventional loan is a mortgage that is not insured or guaranteed by a federal agency. Most follow the guidelines of Fannie Mae and Freddie Mac ("conforming" loans), which is why so many lenders offer them and why pricing is competitive. They come in fixed-rate and adjustable-rate versions and can be used for primary residences, second homes and investment properties.

Buyers and homeowners with established credit and stable, documented income. Conventional loans are also the usual route for second homes and rental properties, for condos, and for borrowers who want to avoid the upfront mortgage insurance that government programs carry.

A credit history that meets the program's standards; income documentation such as pay stubs, W-2s or tax returns; statements showing the funds for your down payment and closing costs; and an appraisal of the property. Mortgage insurance may apply depending on your down payment and drops off once you have enough equity.

Because conventional guidelines reward stronger credit and larger down payments with better pricing, it's worth comparing a conventional quote against FHA — we'll run both for you so the choice is made on numbers, not assumptions.