A conventional Mortgage is from a Bank, not the Federal Government, which is called an FHA mortgage. FHA, Fannie Mae, the quasi government lending institution has low levels of down payment requirements, as state by others that is 3.5%, with that low down payment comes a higher level of risk for default, i am not suggesting you are ever going to consider such an option, but statistically low down payment, higher risk of default, you have less to loss. OK, you know all that. To get a conventional loan you are likely to pay 20% down. Some banks will give a loan with as little as 10% down, but because you are not vested in the home with 20% equity, you will be required to pay Mortgage Insurance, which is maybe $50-$100 a month for a $150K mortgage amount with 10% down. NOW, FHA given the same scenario, lets say 10% down, you still forced to pay MI, with an FHA loan that MI is 50% higher...you gotta love the government...offer a product that is risky then charge a 50% premium on MI to cover their risky loan product.
I am very passionate on this subject, i write tons about down payment, affording your home ect...here is one of my blogs.
best of luck,
OH yeah, real estate prices are going anywhere for a long time, so don't be i a rush!
ps, if you have found this to be a helpful answer please mark it as BEST...Thank you kindly.