What type of loan has the lowest closing costs?

A conventional loan has the lowest closing costs because there is no Funding Fee as in a VA loan and no Up Front Mortgage Insurance Premium as in an FHA loan. This is not to say that a conventional loan is always better. There are advantages to all and each person's situation is different. Speak to your loan officer and have them prepare different options for you to look at; they should explain which would fit you best and why.