2006-12-21 02:07:03 · 10 answers · asked by daisyfield 1 in Business & Finance ➔ Renting & Real Estate
It will depend on you and your qualifications. If your credit is the greatest, or you're putting down a big (more that 20%) down payment, probably conventional will end up being the way to go. If it's more average, then conventional "A" paper may be out, but you might still qualify for FHA (at "A" paper interest rate).
Yet if your credit is too bad for FHA, then conventional "B" or "C" might fit.
Find a loan officer who is qualified for both. It's not easy for a mortgage broker to get licensed to do FHA, so if you go to someone who is, you know they're legit. And if they offer both, they can compare apples to apples for your specific situation.
2006-12-21 02:28:13 · answer #1 · answered by teran_realtor 7 · 0⤊ 0⤋
The answer to that question depends on the borrower's particular situation. If the borrower can make more than a minimum down payment and has excellent credit scores it may be more beneficial to seek conventional financing. If, on the other hand, the borrower is working with limited funds, needs grant money to close, or has less than perfect credit, and FHA loan may be the right loan product.
Despite the earlier comment, FHA loans are not more difficult to close although they may have more stringent property condition requirements and require the seller pay a small amount of costs they are not required to pay on a conventional loan. In addition, the initial FHA mortgage insurance premium is financed as a part of the closing costs which may increase the borrower's interest write off a bit.
A qualified, experienced loan officer who has access to both programs can show you a comparison that will make your choice more obvious.
2006-12-21 02:31:01 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Yes, the reason conventional is better is because there are many more avenues in which you can do the loan. With an FHA loan the process is much more difficult. Take a look at the site below, it might be of interest to you.
2006-12-21 02:14:47 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Not if you can qualify for a conventional loan. It charges mortgage insurance which is of no value to you, about 1/4% or more. And yes you can include it in your loan, but it's still an extra charge that you want to avoid if you can.
If you are a 1st time buyer with good credit, there are better options out there for you.
2006-12-21 02:36:13 · answer #4 · answered by Anonymous · 0⤊ 0⤋
FHA is now Rural Development and Urban Development. They are part of USDA and are VERY liberal. I recommend them to my clients especially First Time Buyers. Also, the state Housing Authority in your state has many great programs.
2006-12-21 02:55:15 · answer #5 · answered by Anonymous · 0⤊ 0⤋
FHA loans have incredible benefits if you can get one! No credit scores, lower down payments, lower interest rates, you can get it sooner after foreclosure, etc. Here's a full comparison chart of the two:
http://www.fha-home-loans.com/fha_loan_comparison.htm
Good luck!
2006-12-21 02:15:51 · answer #6 · answered by Angry Daisy 4 · 0⤊ 0⤋
usually it is. however, fha is on a comeback and promises to offer better programs in the near future.
2006-12-22 05:24:10 · answer #7 · answered by Anonymous · 0⤊ 0⤋
Thank you everyone for the answers!
2016-08-23 13:24:31 · answer #8 · answered by jeanne 4 · 0⤊ 0⤋
Not sure
2016-08-08 22:08:23 · answer #9 · answered by ? 3 · 0⤊ 0⤋