Confused by the mortgage maze?

A mortgage with an interest rate that does not change during the 30-year life of the loan. This is the most common type of mortgage. Since the interest rate does not change, it provides stability and security for the borrower. The borrower’s creditworthiness can greatly affect the interest rate lenders are willing to offer. If you have poor credit, you might get a higher rate. And because it’s locked for 30 years, you lose the financial benefit if rates drop.

Risk-averse home buyers seeking to lock a long-term interest rate that has a stable, predictable monthly principal and interest payment. A person who is looking for the lowest payment or knows he/she will be moving within a short time frame. : FHA loans are backed by the federal government and generally have relaxed credit guidelines.

They also allow lower down payments for first-time home buyers and come in a number of different loan products ranging from one- to five-year adjustable-rate mortgages to 15- and 30-year fixed-rate mortgages. The FHA loan program has down payment requirements that are low and credit requirements that are less stringent. The adjustable-rate products are good at protecting the borrower from severe rate increases.

Borrowers may be required to pay upfront mortgage insurance premiums as well as monthly premiums. First-time home buyers and buyers with limited savings for a down payment. Buyers who can afford a 20 percent down payment. Most lenders offer VA loans that are available to some veterans, active service members, reservists and members of the Public Health Service. The loans require no down payment.

The government also limits the amount of closing costs and origination fees lenders can charge, as well as the appraisal fees. Veterans who qualify as 10 percent or more disabled as a result of active military service don’t have to pay a funding fee. Congress has levied one-time funding fees on VA loans since 1982. Those fees range from 1.25 percent to 3 percent, based on the veteran’s service and if it’s a first or subsequent loan. Veterans who have limited savings for a down payment. Veterans who can afford other loan types to avoid the funding fees associated with VA loans.