Conventional mortgages often meet the down payment and income requirements set by Fannie Mae and Freddie Mac. Unlike FHA and VA, conventional mortgage are not backed or guarantee by the government in the event of mortgage default, therefor they are considered a greater risk resulting, these mortgages can have tougher qualifying requirements and higher interest rates. Conventional mortgage borrowers typically make larger down payments than FHA borrowers, and they tend to have a more secure financial standing.