What's the difference between conventional, FHA, VA, and USDA in plain English?

What's the difference between conventional and government loans?

You want to understand the main types of home loans and how they differ from each other. Each loan type has different requirements, down payment amounts, and eligibility rules that affect who can use them.

Conventional loans come from private lenders and typically require higher credit scores and down payments, but they work for most property types and loan amounts. FHA loans are backed by the government and allow lower down payments (as little as 3.5%) and lower credit scores, making them popular with first-time buyers. VA loans are available only to eligible military service members, veterans, and spouses—they often require no down payment and no mortgage insurance. USDA loans help buyers purchase homes in eligible rural and suburban areas, also with no down payment required for qualified applicants.

The main differences come down to who can qualify, how much you need for a down payment, and where you can buy. Conventional loans offer the most flexibility but require stronger finances. Government-backed loans (FHA, VA, USDA) have more relaxed requirements but come with specific eligibility rules.

Talk with a lender about which loan types match your situation. They can walk you through the specific requirements and help you compare what each option would cost.