FHA vs Conventional Mortgage Comparison Guide for First-Time Buyers (2026)
Compare FHA vs conventional mortgages: down payment requirements, credit score thresholds, PMI costs, and qualification criteria for optimal loan selection.
Summary
FHA loans offer lower down payment but higher ongoing costs. Conventional loans require more upfront but lower total cost. This guide explains selection criteria.
Key Steps
- 1Compare down payment: FHA 3.5% vs conventional 3-20% minimum.
- 2Check credit score: FHA 580+ minimum, conventional 620+ typical.
- 3Calculate PMI costs: FHA MIP (1.75% upfront + annual), conventional PMI (cancel at 80% LTV).
- 4Evaluate loan limits: FHA limits vary by county, conventional no limit.
- 5Consider refinance path: FHA to conventional refinance for PMI removal.