FHA vs Convential Mortgage

Can anyone tell me the pros and cons? We met with a broker we've been speaking with today, and the rates for the FHA were actually lower than for convential. And I still wasn't clear on why going FHA is so much worse - hence why we're meeting with a different broker late in the week, but I'm just trying to wrap my head around all this.

So if anyone knows, what are the major difference aside from total loan amount, PMI, and %down?

Re: FHA vs Convential Mortgage

meet with another broker

FHA loans are always more expensive
and you always have to pay PMI

you can put less down- as little as 3%

but the always cost more-

Re: FHA vs Convential Mortgage

The big difference for us was the upfront MIP (mortgage insurance premium) + the monthly mortgage insurance premium. The MIP is 1.5% of the mortgage, and increases the money needed at closing by almost 50%.

Big bank told us they were only doing FHA loans right now. We are meeting with another broker and looking into a conventional mortgage. It doesn't hurt to look at all your options.