FHA vs. Conventional Loans: Which Is Right for You?

Introduction

Choosing between an FHA loan and a conventional loan is one of the first big decisions you’ll face as a homebuyer. Both have distinct advantages depending on your financial situation, credit history, and down payment.

1. FHA Loans at a Glance

FHA loans are backed by the Federal Housing Administration and are designed for borrowers with lower credit scores or smaller down payments. You can qualify with a credit score as low as 580 with 3.5% down.

The trade-off is that FHA loans require mortgage insurance for the life of the loan (unless you refinance), which adds to your monthly costs.

2. Conventional Loans at a Glance

Conventional loans are not government-backed and typically require a credit score of 620 or higher. They offer more flexibility in terms, lower insurance costs, and the ability to drop PMI once you reach 20% equity.

If you have strong credit and can put down at least 5–10%, a conventional loan often provides a lower overall cost.

Next Steps

Not sure which loan type is right for you? US Home Portal can help you compare options side by side and connect you with lenders who specialize in both FHA and conventional financing.