FHA vs Conventional Home Loan Down Payment Comparison

Understanding FHA vs Conventional Home Loan Down Payment Comparison

When purchasing a home, choosing between an FHA and conventional loan can significantly impact your upfront costs and monthly payments. This comprehensive calculator helps you make an informed decision by comparing both options side-by-side.

How Calculations are Derived

Our calculator uses current market standards and official guidelines from both FHA and conventional loan programs. Key factors include:

• FHA loans require 3.5% minimum down payment
• Conventional loans typically require 3-20% down payment
• FHA loans include upfront MIP of 1.75%
• FHA monthly MIP is 0.85% annually
• Conventional PMI varies by down payment and credit score

Legal/Financial Implications

• FHA loans cannot be cancelled without refinancing
• Conventional PMI can be removed at 20% equity
• Different credit score requirements
• Property condition standards vary

Case Studies

1. First-time buyer with 5% down
2. Buyer with 20% down payment
3. Credit-challenged buyer comparison

FAQ

1. When is FHA better than conventional?
2. How to eliminate mortgage insurance?
3. Can I refinance from FHA to conventional?
4. What credit score do I need?
5. How are interest rates determined?

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