( NewsNation ) — Buying a house can feel overwhelming, including finding a home loan that’s right for you and your family.
Loans are separated by size and whether they’re part of a special government program, and the kind of loan you receive informs its cost and how much money you will need for a down payment. Loan types may also dictate how much you’re allowed to borrow, meaning they could be a major factor in setting a price range while you browse the market.
Here’s a breakdown of common loan types and what they may mean for you.
Are you a ‘cost-burdened’ renter? Here’s how to tell
Conventional home loans
These represent the majority of loans. Although they usually cost less than some other types of loans, they can also be harder to get.
There are two types of conventional loans: Conforming and nonconforming.
Conventional conforming loans are the most common. The loan amount must be $766,550 or less in most counties. It can also be as much as $1,149,825 in higher-cost areas, according to the Consumer Financial Protection Bureau (CFPB).