A conventional loan is a mortgage that is not guaranteed or insured by any government agency. These loans have established guidelines for borrower credit scores, income requirements and minimum down payments. Most of these mortgages have either fixed or adjustable interest rates. Typical fixed interest rate loans have a term of 15 or 30 years. Adjustable-rate mortgages, or ARMs, fluctuate in relation to the rate of a standard financial index. The drawback of conventional loans is the difficulty they present for borrowers with less than good credit or lack of a substantial down payment. But on the upside, conventional mortgages generally pose fewer bureaucratic hurdles than FHA or VA mortgages, which may take longer to process because of the red tape. And because these mortgages generally require higher down payments than the others, home equity can build up faster.