Change the numbers to compare loan amounts and insurance rules. This example cannot predict approval or quote costs.
Both loans use the same price and down payment. This loan amount is before fees or mortgage insurance added to the loan. It is not the final loan amount or the total cash you need at closing. This tool does not estimate rates or insurance costs.
Conventional
Selected down payment$14,000Some conventional options allow 3% down for eligible buyers. You selected 3.5%. Your lender must check which rules apply.
Fannie Mae's automated review has no set minimum score. Lenders can set stricter rules; other programs differ.
Mortgage insurance
With less than 20% down, private mortgage insurance is often required. It protects the lender, not you. Its cost and the rules for ending it depend on the loan. No insurance cost is shown.
FHA
Selected down payment$14,000You selected 3.5% down, compared with the 3.5% FHA guideline for this score range. Meeting this amount does not mean the loan is approved.
At 580 or above, FHA may allow 3.5% down for eligible buyers. Lender and other program rules still apply.
Mortgage insurance
FHA generally charges mortgage insurance at closing and through ongoing payments. It protects the lender, not you. For a new FHA case in this example, the ongoing charge generally lasts the full loan term. This assumes the original loan is 96.5% of the home value used for the loan. Actual rules apply. No insurance cost is shown.
A useful next step
Review your full application and actual lender requirements with Troy rather than choosing by score alone.
This is a learning tool, not a loan approval. A lender must review your full application, loan limits, home and any extra lender rules. Having no credit score needs a separate review. FHA and conventional insurance have different rules. FHA insurance does not simply end at 20% equity. Equity is the home value left after subtracting what you owe.
More detail, when you need it
Full CONVENTIONAL credit rules
Fannie Mae's automated review system, DU, reviews the full application without a set minimum score. Other loan programs and lenders can have different rules. This does not mean a lender will accept this score. Fannie Mae's automated review system, DU, has no set minimum score. A lender reviewing the loan under Fannie Mae's manual rules uses different score requirements. Lenders can also set stricter minimums. Fannie Mae's automated review system, DU, has no set minimum score. When a lender reviews the loan under Fannie Mae's manual rules, the usual minimum is 620 for a fixed-rate loan (the interest rate stays the same) or 640 for an adjustable-rate loan (the interest rate can change), with exceptions and other rules. A 3% down option has separate requirements.
Full FHA credit rules
For a standard FHA loan, the score used to make the loan decision must be at least 500. If you have no credit score, different rules may apply. Ask a lender to review your credit history. At a score of 500 through 579, FHA generally limits the loan to 90% of the home's qualifying value. That commonly means at least 10% down. Meeting that rule does not mean a lender has approved you. Eligible FHA borrowers with a score of at least 580 may qualify for a 3.5% minimum down payment. A lender can require a higher score or apply additional conditions.
Full VA credit rules
VA does not set a minimum credit score. You still need to qualify for the VA benefit and meet the lender's credit and income rules. VA does not set a minimum score, but lenders may. You still need to qualify for the benefit and meet the loan's other rules. VA does not set a minimum score. Lenders still review your credit, income, VA benefit eligibility and the property.