Types of Mortgages: Conventional, FHA, VA, USDA and Jumbo Loans
The main types of home loans in the US are conventional, FHA, VA, USDA and jumbo mortgages. This guide compares their down payments, credit requirements, mortgage insurance and loan limits, explains who each one suits, and covers less common options like ARMs, reverse mortgages and non-QM loans.
By Pond.com editors Updated 5 min read
Quick answer
- Conventional loans are the most common; you can put as little as 3% down, with PMI until you reach 20% equity.
- FHA loans allow 3.5% down with a credit score of 580, but mortgage insurance often lasts the life of the loan.
- VA loans for eligible service members and veterans need no down payment and no monthly mortgage insurance.
- USDA loans need no down payment for homes in eligible rural and suburban areas, with income limits.
- Jumbo loans are for amounts above the conforming limit, $832,750 in most of the US in 2026.
Not every mortgage is the same. The type of loan you choose affects how much you need to put down, what credit score you need, whether you pay mortgage insurance and how much the loan costs over time. Most buyers can choose between two or three types, so it's worth knowing the differences before you talk to lenders.
This guide is general information, not financial advice. Figures are for 2026; loan limits are updated each January.
The main types at a glance
| Conventional | FHA | VA | USDA | Jumbo | |
|---|---|---|---|---|---|
| Minimum down payment | 3% | 3.5% | 0% | 0% | Often 10% to 20% |
| Typical minimum credit score | About 620 | 580 (500 with 10% down) | Set by lender, often 580 to 620 | Set by lender, often 640 | Often 700 or higher |
| Mortgage insurance | PMI under 20% down, removable | Upfront and annual MIP | None; one-time funding fee | Upfront and annual fee | Usually none |
| Who it's for | Most buyers with fair to good credit | Lower credit scores or small down payments | Eligible service members and veterans | Moderate incomes in eligible areas | Expensive homes |
Conventional loans
Conventional loans aren't backed by the government. Most follow the rules of Fannie Mae and Freddie Mac, which makes them conforming loans.
- Loan limit: $832,750 for a one-unit home in most of the US in 2026, and up to $1,249,125 in high-cost areas.
- Down payment: as little as 3% for some first-time buyers and lower-income programs, otherwise often 5%.
- PMI: required under 20% down, but it can be removed once you have enough equity. See how to get rid of PMI.
- Best for: buyers with a credit score of about 680 or higher, where conventional is often the cheapest choice.
FHA loans
FHA loans are insured by the Federal Housing Administration, so lenders can accept lower credit scores.
- Down payment: 3.5% with a credit score of 580 or higher, or 10% with a score from 500 to 579.
- Mortgage insurance: an upfront premium of 1.75% of the loan, usually added to the loan, plus an annual premium, typically 0.50% to 0.55% of the loan for most borrowers, paid monthly.
- How long it lasts: 11 years if you put down at least 10%; otherwise for the life of the loan. Many people later refinance into a conventional loan to drop it.
- Loan limits: in 2026, from $541,287 in lower-cost areas up to $1,249,125 in high-cost areas.
- The home: must pass an FHA appraisal, which checks basic safety and condition.
VA loans
VA loans are guaranteed by the Department of Veterans Affairs for eligible service members, veterans and some surviving spouses.
- No down payment in most cases, and no monthly mortgage insurance.
- Funding fee: a one-time fee, which can be added to the loan. For a first-time purchase with less than 5% down, it's 2.15%; it drops to 1.5% with 5% down and 1.25% with 10% down. It's 3.3% for later use with less than 5% down.
- Exempt from the fee: veterans receiving VA disability compensation, Purple Heart recipients on active duty and some surviving spouses.
- Rates are often lower than for other loan types.
USDA loans
USDA loans, from the US Department of Agriculture, help moderate-income buyers in eligible rural and some suburban areas.
- No down payment.
- Income limit: usually up to 115% of the area's median income.
- Location: the home must be in an eligible area; check an address on the USDA's eligibility map.
- Fees: an upfront guarantee fee of 1% and an annual fee of 0.35%, paid monthly.
Jumbo loans
A jumbo loan is a mortgage above the conforming limit. Because Fannie Mae and Freddie Mac won't buy them, lenders set their own rules, which are usually stricter: higher credit scores, larger down payments, lower debt-to-income ratios and several months of payments in savings.
Other types you may hear about
- Adjustable-rate mortgages (ARMs): any of the loan types above can come with a rate that's fixed for a few years and then adjusts. See fixed vs adjustable-rate mortgages.
- Reverse mortgages: for homeowners 62 and older, to turn home equity into income without monthly payments. They're complex, and federally insured ones require counseling first.
- Non-QM loans: for borrowers with unusual income, like some self-employed people, using bank statements instead of tax returns. Rates are usually higher.
- Construction loans: short-term loans to build a home, often converted into a regular mortgage when it's finished.
How to choose
- Check what you qualify for: VA if you've served, USDA if the area and your income fit.
- Compare conventional and FHA if you have a smaller down payment. Ask lenders to quote both, including mortgage insurance.
- Look at the total cost, not just the rate: fees, mortgage insurance and how long you'll pay it.
- Look into local help for first-time buyers. See first-time home buyer programs.
Common questions
With a credit score of about 680 or higher and at least 5% down, a conventional loan is often cheaper, because PMI can be removed later. FHA can be better with a lower score or higher debts, since its rates are less affected by credit. Ask lenders to quote both and compare the total monthly cost.
Most veterans, active-duty service members and some National Guard and Reserve members who meet service requirements, plus some surviving spouses. You'll need a Certificate of Eligibility, which your lender can usually request for you online.
A conventional loan that meets Fannie Mae and Freddie Mac's rules, including the loan limit. For 2026, the limit for a one-unit home is $832,750 in most areas and up to $1,249,125 in high-cost areas. Limits are updated every year.
Yes, but it costs more. FHA loans allow scores down to 580 with 3.5% down, or 500 with 10% down, though many lenders set their own higher minimums. Raising your score even 20 to 40 points before you apply can noticeably lower your rate.