When buying a home, selecting the right loan can be just as important as choosing the home itself. The loan you choose can affect how much money you need upfront, what your monthly payment looks like, where you can buy, and how comfortable you feel moving forward.

USDA Loans

USDA loans are designed for eligible buyers purchasing homes in approved rural and suburban areas. They do not require a down payment, and lenders typically look for a credit score of 640 or higher. USDA loans also include income limits, which generally cap total household income at 115% of the area’s median household income.

VA Loans

VA loans are another type of zero-down-payment mortgage and a great option for qualifying veterans and service members. The U.S. Department of Veterans Affairs backs these loans, which are known for their flexibility and excellent benefits.

FHA Loans

FHA loans are a common home loan choice, especially among first-time buyers, because they offer more leniency toward lower credit scores and higher debt amounts and require a low down payment of only 3.5%.

Conventional Loans

Conventional loans are the most popular loan type for their flexibility. Unlike other mortgage types, a government agency does not back conventional loans. Conventional loans cover a wide range of home loans, but generally refer to any home loan that is privately funded and follows guidelines set by government-sponsored entities Fannie Mae and Freddie Mac.

Ultimately, the right home loan depends on your goals, where you’re buying, and what your finances look like today.

Original reporting: KRDO (Colorado Springs metro) — read the source article.