The Federal Housing Administration was created in 1934 as an effort to bolster homes sales during the Depression. By financially guaranteeing loans the FHA lifts much of the risk of non-payment and foreclosure from private lenders. It is important to remember that the FHA is not a lender; they just guarantee your loan. 

  • Bankruptcy not an automatic disqualification.
  • Less stringent credit requirements.
  • Lower interest rates.
  • Down payment is less.
  • Lower mortgage points and other closing cost requirements.
  • Resale can be made quicker.
  • Is backed by the U.S. government.

  • Down payment required.
  • Higher MIP than on conventional loans.
  • Loan Limits are lower than conventional.
  • MIP required regardless of the Loan-to-Value (LTV).
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