Types of Home Loans for Beginners: Utah

Buying your first home can feel overwhelming—especially when you start hearing terms like “conventional,” “FHA,” or “jumbo.” The good news: there are only a handful of common loan types, and once you understand what each one is designed to do, the decision becomes much simpler.

I’m Morgan Meyer, Realtor, and I work closely with my preferred lender, Des O'byrne with Tru Path Home Loans, to help first-time buyers understand their options and get confidently pre-approved.

1) Conventional Loans

Conventional loans are the most common and flexible option. They’re a great fit for buyers with steady income and decent credit, and they can be used for primary homes, second homes, and even investment properties.

• Minimum down payment can be as low as 3% (depending on qualification).

• If you put less than 20% down, you’ll typically pay private mortgage insurance (PMI).

• PMI can usually be removed once you reach about 20% equity (rules vary by loan).

2) FHA Loans

FHA loans are designed to make homeownership more accessible. They often allow for lower credit scores and smaller down payments compared to conventional financing.

• Commonly used by first-time buyers.

• Includes mortgage insurance: an upfront premium plus monthly mortgage insurance.

• FHA appraisals can be more sensitive to property condition requirements.

3) VA Loans

VA loans are for eligible veterans, active-duty service members, and some surviving spouses. They’re one of the strongest loan benefits available.

• 0% down payment options.

• No monthly mortgage insurance.

• A VA funding fee may apply (varies by eligibility and usage).

4) USDA Loans

USDA loans are intended for eligible properties in designated areas (often outside dense city centers). They can be a great low-cash option if you qualify.

• 0% down payment options.

• Income limits apply based on household size and location.

• Includes an upfront guarantee fee and a smaller annual fee paid monthly.

5) Jumbo Loans

A “jumbo” loan isn’t a separate program—it simply means the loan amount is above the conforming loan limit for the county. Jumbo guidelines are typically stricter.

• Often requires higher credit scores.

• May require larger down payments and more cash reserves.

• Great for higher-priced homes when you want to avoid splitting financing.

What About Rate Buydowns, Points, and Closing Costs?

Beyond loan type, your monthly payment is influenced by interest rate, points (prepaid interest), and closing costs. Des can walk you through scenarios like temporary or permanent rate buydowns so you can compare options side-by-side.

The Beginner-Friendly Mortgage Process (What to Expect)

Most buyers are surprised that choosing the loan type is the easy part—the process is mainly about documentation and verification. Here’s the typical flow:

• Pre-approval: credit, income, and assets are reviewed so you can shop with confidence.

• Processing: documents are collected and verified.

• Underwriting: the lender completes the formal risk review.

• Appraisal: confirms value (and sometimes condition expectations).

Tips to Keep Your Loan on Track

• Avoid opening new credit cards or taking on new debt while under contract.

• Keep bank activity clean and explainable—ask before moving large sums of money.

• Respond quickly to document requests to prevent delays.

• If anything changes (job, income, large deposits), tell your lender right away.

Ready to Get Pre-Approved?

If you’re buying in Utah and want a clear plan, I’m happy to help you map out neighborhoods, pricing, and offer strategy—and Des Obyrne at Tru Path Home Loans can help you choose the best loan type for your goals.

Reply here and I’ll connect you with Des and send a simple first-time buyer checklist.