Conventional mortgage loans, although not insured by the federal government, must adhere to the mortgage guidelines set by Fannie Mae,and the Freddie Mac. Unlike federally insured loans, conventional loans carry no guarantees for the lender in the event the borrower defaults which is why these loans require mortgage insurance if the borrower is putting less than 20% down on the mortgage. I like conventional mortgages and encourage my clients to consider this loan structure if they qualify because the mortgage insurance is very reasonable.