Great question! And here is the answer: it isn't. FHA has only really made a huge presence in this market over the past year. There are still a lot of agents, including listing agents, who are not familiar with FHA loans and therefore only know what they hear in the media. That is really too bad. Of my last 6 transactions, 5 of them were FHA, and one of them was for a house that sold for $645,000 and had 7 offers on it. In fact, that house closed in 23 days. Yes, an FHA loan that closed in 23 days! My suggestion is when you make an offer, have the mortgage broker pro-actively call the listing agent and ask them their experiences with FHA; if they have none, or their experience is limited, have the mortgage broker explain the process to them. A little education makes all the difference in the world. Because of this I have yet to have my clients lose a house in competition because they were FHA. You can do the same.