The Federal Housing Administration (FHA), which is part of the U.S. Dept. of Housing and Urban Development (HUD), administers various mortgage loan programs. FHA loans have lower down payments requirements and are easier to qualify than conventional loans.
A conventional mortgage refers to a loan that is not insured or guaranteed by the federal government. A conventional, or conforming, mortgage adheres to the guidelines set by Fannie Mae and Freddie Mac. It may have either a fixed or adjustable rate.
Fixed or Adjustable Rate Mortgage Loans
In a fixed rate loan, your interest stays the same during the whole life of the loan, usually around 30 years. An adjustable mortgage is one whose interest rate, and consequently monthly payments, fluctuates over the period of the loan