Compare eligibility, monthly cost and cash needed for the same home. No program is automatically best for every first-time buyer.
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Conventional, FHA, VA or USDA
Compare the payment and total interest
Fixed or adjustable
Ask which options fit your eligibility, property and budget.
Start with the program
Conventional loans and government-backed FHA, VA and USDA loans serve different needs. FHA offers low-down-payment options. VA is for eligible military borrowers and surviving spouses. USDA serves eligible borrowers and properties in qualifying rural areas. Program and lender requirements vary.
Compare the whole cost
Ask each lender about down payment, interest, mortgage insurance, program fees and cash needed at closing. A low down payment does not automatically mean the lowest total cost. Ask about state or local buyer programs too.
Choose a term and rate type
Shorter terms usually have higher monthly principal-and-interest payments and less total interest. A fixed-rate loan keeps its rate stable, although taxes and insurance can change. An ARM can adjust after its initial period; review the adjustment rules and caps.
Use matching examples
Run the same home price through the mortgage calculator. Then ask for lender quotes that use the same term, down payment and lock period. Replace calculator defaults with your actual costs.
Put program costs next to each other
Write down the cash required, principal-and-interest payment, mortgage insurance and any program fee. For FHA, confirm mortgage insurance. For VA, ask about a funding fee or exemption. For USDA, confirm the applicable fees and property eligibility.
Ask about what changes later
For an ARM, request the first adjustment date, index, margin and caps. For any loan, ask whether mortgage insurance can end and under what conditions. Keep these future costs in the comparison rather than looking only at the first payment.
SEE THE NUMBERS
Loan programs at a glance
| Program | Down-payment starting point | Costs and eligibility to confirm |
|---|---|---|
| Conventional | Some programs allow 3% | Program rules; PMI usually applies below 20% down |
| FHA | As low as 3.5% for eligible borrowers | Mortgage insurance; county loan limit; lender requirements |
| VA | Zero down may be available | Military eligibility; funding fee or exemption; no monthly mortgage insurance |
| USDA | Zero down may be available | Eligible area and income; program fees |
These are starting points, not guaranteed terms or approval. Program rules and lender requirements can make the actual down payment higher.
Key terms, in plain English
- Conventional
- A mortgage outside a specific government loan program.
- FHA
- A loan from a private lender insured by the Federal Housing Administration.
- VA
- A private-lender loan guaranteed by the Department of Veterans Affairs for eligible borrowers.
- USDA
- A rural housing loan option with borrower and property eligibility rules.
- Mortgage insurance
- Protection for the lender; it is different from insurance on your home.
Common mistakes to avoid
- Comparing only advertised interest rates.
- Assuming “first-time buyer” means only one loan program is available.
- Choosing an adjustable rate without understanding what happens after the introductory period.
Questions to ask
Bring these to your lender, agent or housing counselor, as appropriate.
- Which programs fit my property and financial situation?
- What insurance or fees apply, and when can they end?
- Can you provide matching Loan Estimates for the options I qualify for?
Common questions
Is FHA only for first-time buyers?
The FHA loan category is not limited to first-time buyers. Ask the lender about eligibility for your situation and any separate first-time-buyer assistance.
Does zero down mean no money at closing?
No. Closing costs and other expenses may still apply. Ask how they will be paid.
Is mortgage insurance homeowners insurance?
No. Mortgage insurance protects the lender against certain losses if you do not repay. Homeowners insurance covers specified property losses under your policy.
Your next steps
- Ask which programs you qualify for.
- Compare insurance and program fees.
- Test your payment with lender figures.
Sources and further reading
Official resources checked October 12, 2026. Loan and program rules can change. Confirm the requirements for your own purchase.
- CFPB: understand loan choices ↗
- CFPB: conventional loans ↗
- CFPB: FHA loans ↗
- CFPB: VA, USDA and local programs ↗
Educational information and planning examples; not a loan offer or personalized financial advice.