Just like when you decide on a home to buy, a mortgage is something that needs to be comparison-shopped. Virtually all mortgage companies offer conventional loans, but not every lender offers.

A Quick Comparison of FHA and Conventional Loans. The time period for an FHA loan is 3 years instead of 7 for foreclosure and 2 years instead of 4 years for bankruptcy. The appraisal process for an FHA is more astringent that others, requiring the inspector to address any health or safety issues and require repairs or modifications before closing.

20 Down Payment Insurance Another reason is if you don’t make a minimum down payment of 20%, you will usually be required to pay private mortgage insurance. [Read: What to Expect From the Housing Market in 2019.] PMI, as it is.

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FHA loans is a government program for first time home buyers and is insured by the federal housing administration, an agency of the U.S. government. As compared to conventional loans, FHA-insured loans generally have smaller downpayment requirements and in some cases may have more flexible underwriting requirements.

What is the difference between an FHA vs conventional loan? The defining difference between an FHA vs conventional loan is that with an FHA loan, the mortgage is insured by the Federal Housing Administration while a conventional loan is not insured by the government.

As with an FHA loan, borrowers looking for a conventional loan will still have to show they have a reliable income and steady employment history, especially from the previous two years. Lenders will also look at your debt-to-income ratio.

Mortgage With Less Than 20 Down According to a recent report, just over half of all home buyers in Washington State and nationwide make down payments below 20% when buying. This is further evidence to debunk the longstanding myth that home buyers have to put down 20% in order to qualify for a mortgage loan. More Than Half of home buyers put Down Less Than 20%

Which Is Better FHA or Conventional (Part 1 - The FHA Loan) Loan-to-Value and Combined Loan-to-Value Mortgage Amount Calculation Comparison Criteria Rate-and-Term Refinance (Conventional-to-FHA or FHA-to-FHA)

FHA loans are available with credit scores of 580 or better. The Conventional 97 loan, by contrast, requires a minimum credit score of 620.

Unless you’re already a mortgage expert, picking between an FHA loan and a conventional loan can be tricky. Luckily, we’re about to lay it all out for you-the advantages, the disadvantages, the requirements, and how to choose. If you just want to sit back and relax, our mortgage blogger.

FHA.co is an online community of licensed lenders. Talk to a lender in your area today to get the best rates on an FHA loan.

FHA loans have lower interest rates than conventional loans because FHA loans are safer for lenders. However, you have to pay premiums on the FHA mortgage insurance in addition to your mortgage payment.