What’s the difference between FHA and Conventional loans?

B

FHA mortgages are insured by the Federal Housing Administration and protect the lender from default. If you fail to pay your mortgage, the FHA will reimburse the lender for the balance owed. This added protection allows lenders to take more risk and lend to borrowers with lower credit scores and/or higher debt ratios. A conventional mortgage often conforms to Fannie Mae or Freddie Mac underwriting guidelines and is better suited for borrowers with higher credit scores.