What’s the difference between FHA and Conventional financing? Both can be a good fit for first time home buyers, but can vary a bit. FHA tends to be looser on borrower guidelines, but a bit stricter in regards to the property. Conventional tends to be the opposite, with typically looser property guidelines and stricter borrower guidelines.
Does either have mortgage insurance? Both can have mortgage insurance. FHA mortgage insurance tends to be a bit higher than Conventional and is put in place regardless of the down payment amount. Conventional mortgage insurance tends to be less expensive, has more flexibility depending on down payment amount, and completely goes away with a down payment of 20% or more.
What are their minimum down payments? FHA’s minimum down payment is 3.5%, and Conventional’s is 3%. Because of their low minimums, either may be a good fit for first time home buyers. However, if you can’t afford either of these down payment amounts, we do offer down payment assistance programs for qualified first time home buyers.
Don’t make the biggest decision of your life without getting educated first! If you’d like more information on these loan programs or our down payment assistance programs, please go to our Calendar/Reservations page and sign up for one of our FREE First Time Home Buyer/Down Payment Assistance workshops.
