Conventional loans are ideal for home buyers with better credit who want to purchase property not approved by the Federal Housing Administration (FHA). Typically, conventional loans have less property restrictions that FHA-approved loans, but require the borrower to have higher credit. Another plus of getting a conventional loan is that once you pay off 20% of the total loan amount, you no longer need to pay for mortgage insurance. 

• Better variety of eligible home types
• Gift funds and grant funds are allowed
• No income limits
• Escrow holdbacks are allowed
• Available nationwide
• Covers 3% down payment and .5% closing costs
• Mortgage insurance can be waived after paying 20% of the loan

• 640 Minimum Credit
• Home Owner Education Course Required
• 35% Mortgage Insurance
• At least one borrower must occupy home

FHA loans through the Chenoa program are a good fit for home buyers with less-than-perfect credit who want to get into a new home. FHA loans typically offer lower interest rates than conventional, but do not offer the same flexibility in terms of property types. Mortgage insurance must be purchased separately and paid for the entirety of the loan. 

• No max combined loan-to-value
• Up to 3.5% down payment
• No 1st-time homebuyer requirement 
• Depending on income, funds may be forgivable after 36 on-time payments
• Available Nationwide

• 620 Minimum Credit
• Home Owner Education Course Required
• Property must be approved by FHA
• Income Limits May Apply