FHA Loans vs. Conventional Conforming Loans

How do FHA loans compare to conventional loans?
FHA Loans have several advantages over conventional loans. Conventional loans usually require a much larger down payment than FHA Loans do (Usually 20% down for conventional loans, 3.5% down for FHA Loans.) And, if you have less than perfect credit you may not qualify for many conventional loans and find yourself being offered loans with higher interest rates and/or fees than you expected. FHA-insured loans offer many benefits and protections that you won't find in conventional conforming loans including:

FHA Loans are Credit Flexible
FHA Loan Credit guidelines are not completely score driven. They are written in a way that provides the borrower the benefit of the doubt that there had been circumstances beyond their control in their past. Provided the borrower has recovered from those circumstances in a reasonable manner, they're generally going to be credit-eligible for an FHA loan. A 620 FICO credit score is required to obtain an FHA Loan Approval through ENG Lending.

FHA Loans Carry Great Rates, Low Monthly Mortgage Insurance
Another advantage of FHA loans, as compared to a conventional loans, is great interest rates and lower monthly mortgage insurance (MI). Standard FHA loan interest rates are usually better than a conforming 30-Year Fixed loan.

FHA Loans Have Smaller Down Payments
FHA Loan Qualifications only require a 3.5% down payment and the money can be a gift from a family member, employer or charitable organization, which other programs don't allow.