What is a common type of conventional loan?

A fixed-rate 30-year mortgage is a common type of conventional loan due to its stability and predictability. This type of loan features a fixed interest rate over a term of 30 years, which means that the monthly payments will remain consistent throughout the life of the loan. This predictability helps borrowers manage their finances, making it easier to budget for monthly housing expenses without worrying about fluctuating interest rates.

The appeal of a fixed-rate mortgage lies in its long-term nature, allowing homeowners to lock in their interest rate for an extended period, especially beneficial in times of low-interest rates. This kind of mortgage is widely available in the market and commonly used by first-time homebuyers and those looking for long-term stability in their mortgage payments. In contrast, the other options represent variations of mortgage types that are less common or have specific conditions that make them less favorable for the average borrower.