A mortgage is the official name for a home loan. You pay a mortgage on a monthly basis, and the payments typically last for 30 years. However, you may get a mortgage to a 15 year period. But, if you choose this option, you will be paying more every month; the obvious reason why some choose this option is they pay off their homes in half the time.

Conventional mortgage: A conventional mortgage is the typical mortgage that lenders offer. When you pursue this form of loan, you must pay a down payment on the house before applying the loan. Via a conventional loan, the down payment is typically 20% of the selling price. Additionally, you must paying closing costs, which vary by situation, and the mortgage includes PMI (loan insurance), home insurance, and property taxes. PMI is included to give the lender some security, in case the buyer cannot make payments and forecloses.

VA mortgage: A VA mortgage is offered to prior and active-service military members. A VA loan does not require a down payment and the buyer does pay any PMI since the loan is backed by the federal government.

FHA mortgage: An FHA loan is a loan backed by the federal government (however, the buyer still must pay PMI) and the buyer typically pays a 3.5% down payment instead of the typical 20%. The loan is typically meant for lower-income, first-time home buyers.

USDA mortgage: A USDA loan is another loan backed by the government. This loan is similar to the FHA, except that buyers do not pay PMI. However, these loans are only available in rural areas.

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