Conventional Loan Programs Conventional loans offer the benefits of combining first and second mortgage financing to meet the minimum down payment requirements. Fixed rate and adjustable rate programs are available with flexible terms. Fixed Rate Mortgage The most common type of mortgage program is one where your monthly payments for interest and principal never change. Property taxes and homeowner’s insurance may increase, but generally your monthly payments will be very stable. Fixed rate mortgages are available with many convenient term options. Adjustable Rate Mortgage ( ARM ) These loans generally begin with an interest rate that is below a comparable fixed rate mortgage and could allow you to buy a more expensive home. However, the interest rate changes at specified intervals depending on changing market conditions; if interest rates go up, your monthly mortgage payment will go up too. However, if rates go down, your mortgage payment could drop.