FHA seems like a great option for you. In today's market you need a 740 or greater score to qualify for the lowest conventional rates. A 660 score (as you've obviously seen) is going to cost you in terms of a higher cost or higher fees. There is no difference credit-wise, however FHA charges a 1.5% Upfront fee as well as monthly mortgage insurance regardless of the value of the home or the equity you have in it.
So technically If you want to do a true comparison of the two programs, have your lender give you a comparison of a 0 point FHA loan and a 1 1/2 point conventional loan and see which has the lowest payment (PITI).
Thank you for purchasing real estate in Michigan! I hope it becomes the home you have always dreamed of.
â€¢ Minimal Down Payment and Closing Costs.
â€¢ Down payment less than 3% of Sales Price with 100% options.
â€¢ Gift for down payment and closing costs allowed.
â€¢ No reserves or required.
â€¢ FHA regulated closing costs.
â€¢ Seller can credit up to 6% of sales price towards buyers costs.
â€¢ Easier Credit Qualifying Guidelines such as:
â€¢ No minimum FICO score or credit score requirements.
â€¢ FHA will allow a home purchase 2 years after a Bankruptcy.
â€¢ FHA will allow a home purchase 3 years after a Foreclosure.
These advantages of the FHA loan program has made it one of the best options for most first time home buyers as well as move-up home buyers.
You do not have to be a first time buyer to obtain a FHA loan, anyone may use a FHA loan as long as you do not have more than one FHA insured loan at any one time.