Purchase - Conventional vs FHA

I want to purchase a home, which program do i qualify for?


Should I do a FHA or conventional mortgage?

There are several types of conventional loan programs that you may qualify for. Each program has different down payment, credit score, property type and loan-to-value requirements.

Fannie Mae and Freddie Mac have several programs for first time home buyers with a low down payment.

  • My Community program requires a minimum down payment of 3%. The borrower’s income cannot exceed 100% of the annual HUD Area Median Income for the subject property’s location.
  • Home Possible® program requires a minimum down payment of 3%. First Time Home Buyers must participate in a home ownership education program. 40-year fixed rate Home Possible® mortgage.
  • Community Solution loans provide additional flexibilities for teachers/educational institution employees, firefighters, police, healthcare workers and military personnel.
  • HomeChoice loans offer borrowers with a disability or who have a family member with a disability who may need greater underwriting flexibilities, including non-occupying co-borrowers.
  • HomePath® program is a fixed-rate, fully amortizing loan program that provides the financing for properties that are owned by Fannie Mae as a result of foreclosure or other similar action such as a deed-in-lieu.
  • Conforming loans that promote home ownership for first time home buyers with programs that offer a low down payment.
  • Conforming High Balance are mortgages originated using higher maximum loan limits that are permitted in designated high-cost areas.

Fannie Mae and Freddie Mac require a minimum credit score of 620 to buy a home. Their mission is to help ensure that home buyers and home owners have access to mortgage financing.

Government Loans

There are several types of government loan programs that you may qualify for. Each program has different down payment, credit score, property type and loan-to-value requirements

FHA requires a minimum credit score of 500. There are no income limits like you may find with first time home buyer programs. However, there are limits on how much you can borrow.

  • 203(b) program provides mortgages for home buyers  to purchase a principal residence with a low down payment and with lower credit standards.
  • 203(k) program is for the rehabilitation and repair of single family properties. Providing both the financing to purchase a property and the financing to make repair. The program offers an important tool for expanding homeownership opportunities.
  • HUD $100 down payment program for borrowers purchasing single-family HUD Real Estate Owned (REO). The program is limited to owner-occupant buyers who have not purchased a HUD REO property within the last 24 months.

HUD's mission is to support the nation’s housing market.

VA Direct Home Loan programs basic intention is to supply home financing to eligible veterans in areas where private financing is not generally available and to help veterans purchase properties with no down payment.

  • VA loans require a minimum credit score 500.

USDA Home Loan program primarily used to help low-income individuals or households purchase homes in rural areas.The Office of Rural Development (RD) is an agency with the United States Department of Agriculture which runs programs intended to improve the economy and quality of life in rural America by offering 100% financing.

Portfolio loans require a minimum credit score 640. A portfolio loan is a loan that is made by a lender that does NOT sell the loan to the Fannie Mae and Freddie Mac. Because they don’t sell the loan off to Freddie or Fannie, they don’t have to follow any of the requirements that Fannie and Freddie have. Examples of portfolio loans are jumbo loans, stated income loans, loans for foreign nationals and loans for investment properties.

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What's the minimum credit score needed to buy a house or refinance


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Fannie Mae

Requires a minimum credit score of 620 to buy a home

Fannie Mae minimum

credit score 620


Freddie Mac

Requires a minimum credit score of 620 to buy a home

Freddie Mac minimum

credit score 620


FHA loan

Requires a minimum credit score of 500 to buy a home

FHA minimum

credit score 500


VA loan

Requires a minimum credit score of 500 to buy a home

VA minimum

credit score 500


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888-958-5382


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