What are the benefits of an FHA home loan versus a conventional mortgage?
FHA Home loans offer numerous benefits to the borrower. First of all, lenders are able to offer low interest rates on FHA loans since they are insured by the government. Secondly, the down payment required for an FHA loan tends to be lower than that of conventional loan programs (currently as low as 3.5% of the purchase price compared with anywhere from 5% to 30% for a conventional mortgage). Furthermore, it has traditionally been much easier for many borrowers to qualify for an FHA Home loans than for conventional loans. FHA loans allow for “common sense” underwriting, permitting lenders to be more flexible in whom they will lend money to when compared with more traditional products with rigid guidelines.
