We are making the case for FHA once again now that MI is so much lower (down to 0.85% from 1.35%). FHA interest rates are much lower than conventional rates, often over 1/2 percent lower. FHA rates are especially competitive for borrowers with low credit scores.
It is a myth that FHA properties need to be in better condition than conventional properties. FHA appraisers will check to ensure appliances work, and they seem to call out “peeling paint” more often, but other than that the condition requirements are the same.
It is also myth that FHA transactions take longer to close. We close FHA deals in 14 days all the time.
FHA is also much more flexible in regard to credit issues and gift funds.
The only drawbacks to FHA: (1) 1.75% up front MIP; and (2) MIP is permanent.
Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646
