Quantcast

There are many mortgages to choose from. There are conventional loans, plus government-backed home loan programs such as VA mortgages, and even USDA home loans. All options to consider. So why choose an FHA mortgage instead?

FHA Loan Programs for 2022

The most recognized 3.5% down payment mortgage in the country. Affordable payments w/good credit.

Are You Watching Your Credit Score?

NOTICE: Some FHA mortgage lenders are substantially raising FICO score requirements during the Coronavirus crisis, even though FHA minimums remain unchanged.


- Improving Your Credit Score Has Never Been More Important -

Get started one
Get started two
Get started three
Get started four
FHA.com is a privately owned website, is not a government agency, and does not make loans.

Choose a Loan Type

FHA.com is a privately owned website, is not a government agency, and does not make loans.

Reasons to Choose an FHA Mortgage Over Other Government-Backed Loans

June 2, 2022

Reasons to Choose an FHA Mortgage Over Other Government-Backed Loans
There are many mortgages to choose from. There are conventional loans, plus government-backed home loan programs such as VA mortgages, and even USDA home loans. All options to consider. So why choose an FHA mortgage instead?

In some cases, the answer is as easy as the numbers. Does the FHA 3.5% down payment minimum appeal to you? It’s a good choice for those who may need to save more upfront on the mortgage. And thanks to the possibility of local down payment assistance programs, an FHA borrower could save even more out of pocket at closing time.

But FHA mortgages aren’t just for those who want a lower down payment. Some are interested in certain options that come with FHA loans such as the ability to be refinanced later with an FHA Streamline Refinance Loan. These refi options typically must result in a benefit to the borrower such as a lower mortgage rate. And yes, lower monthly payments may also be possible.

VA Loans vs. FHA Mortgages

When you compare the FHA loan program to the VA loan program one of the first things you’ll notice is who can apply; FHA loans are for any financially qualified borrower (first-time homebuyer or not) while FHA mortgages have a more restricted pool of borrowers who are allowed to apply for a VA mortgage.

Who are these borrowers? Those with qualifying uniformed service can apply, after having served a minimum time, for the VA mortgage benefit which features a no-money-down option and no private mortgage insurance.

FHA loans do not include an option for zero down, and while they do not require private mortgage insurance you will pay a mortgage insurance premium as part of your monthly mortgage payments.

There is an important difference in the VA loan program compared to FHA mortgages -- the percentage of seller concessions you can get with an FHA loan is higher than for VA mortgages.

Sellers are permitted to contribute up to six percent of the closing costs on an FHA loan. For VA mortgages the VA loan official site says the agency requires a seller to agree to pay no more than 4% of the total home loan in seller’s concessions.” 

FHA Loans vs. USDA Mortgages

USDA mortgages are not approved for the general public but rather for low-to-moderate-income applicants who meet applicable household income restrictions and other need-based qualifying requirements. This makes them different from FHA home loans which are approved for anyone who qualifies with income, employment, and credit scores.

USDA loans may feature zero-down options or reduced down payments depending on circumstance. Applicants who exceed the income limits won’t be approved for a USDA mortgage but there may be exceptions in certain instances such as when borrowers apply to buy homes in a targeted area.

------------------------------

RELATED VIDEOS:
Do What You Can to Avoid Foreclosure
Homes Financed With FHA Loans Must Be Owner Occupied
FHA Programs for First-Time Homebuyers

SEE YOUR CREDIT SCORES   From All 3 Bureaus  

Do you know what's on your credit report?

Learn what your score means.


GET STARTED