Mortgage Basics
A mortgage is a standard lending instrument that is given by a traditional lender such as a bank. This type of loan is not typically backed by any special programs, but can give borrowers the financing they need to purchase a home. A mortgage may involve two different types of interest configurations. A fixed-rate mortgage will offer a set rate for the life of a loan. An adjustable-rate mortgage will have interest charges that can rise or climb based on market factors and going rates.

Conventional Loan
A conventional loan is any mortgage which is not guaranteed or insured by the federal government. Conventional loans were the first traditional mortgage loans made by local lenders. The loans were held in the lender's investment portfolio until they were either paid in full or foreclosed upon. Although it enabled the borrower to build a business relationship with the lender, this practice was generally not in the lender's best financial interest. When rates rose, lenders found themselves in the position of receiving below-market interest on their loans, in addition to not being able to recycle the funds to lend to other borrowers.

FHA Loan
FHA loans are lending instruments that are backed by the federal government. The U.S. Department of Housing and Urban Development guarantees these loans so private lenders will be more likely to approve financing. FHA loans are attractive for buyers for a number of reasons. These loans tend to require low down payments and low closing costs. They also tend to have easier credit requirements than standard lending tools. Loans backed by the FHA are available for first-time buyers, seniors and others through a variety of programs

VA Loans
The United States government offers a number of benefits to its Armed Forces members and veterans for their service. One important example is the VA Home Loan Guaranty Program, which helps veterans and active-duty personnel to purchase and retain homes. Because the Veterans Administration guarantees the loans, Active Duty, Reserve and Guard personnel can receive low-interest rate mortgages, often with little or no down payment required. If you’re a current or previous service member, this section will give you valuable information to help you determine your eligibility, as well as insight into how the program works.

Mortgage Application Documents
When you apply for a mortgage, you will usually need to furnish information regarding your income, expenses and obligations. It will save time and make the process go smoother if you have the following items prepared in advance:

* Pay stubs from the last two months
* W-2s for the last two years
* Federal Tax Returns for the last two years
* Bank statements from the last two months
* A list of long-term debt information (credit cards, child support, auto loans, installment debt, etc.)