FHA Rates VS Convential Rate

[Anonymous]

I'm going to buy my first home with in the next 60 days.  Since I had a bankrupcy back in 2005 with a current Fico score of 709 and $30,000 cash (not including any incentives) to use for down payment and closing cost.  I was told it was best to use a FHA loan it would be easier to get approved.  Does this sound correct?  The price range I'm looking at is 125000-150000.  Also when I look up current interest rates being offered they are on convential loans is the interest rate any different on FHA loans?  How much more should I expect to pay on a FHA loan?

[Anonymous]

Wth conventional your rate is determined by your credit score... FHA only has one rate regardless of your score and typically requires 620 minimum. www.bankrate.com i think lists the current FHA rate. It's been wavering between 5.0 & 5.5% lately.

I think with conventional, you need 5 years after a BK and FHA only requires 3 years. Someone will correct me on that if i'm wrong  

[Anonymous]

I'll do it

Without a foreclosure FHA will do it 2 years post-discharge. I don't recall if conventional is 3 or 4 now.

[Anonymous]

So my Fico score doesnt matter with FHA being at 709 I would get the same rate as someone with 650? 

[Anonymous]

That is correct, Ruddy. One rate for everyone regardless of score.

And thanks deemac

[Anonymous]

Just to clarify, Wells Fargo might charge 5.00% (current rate) whereas Bank of America may charge 5.25% (example only) for a FHA loan.

Different lenders offer different FHA rates so it pays to shop around.

[Anonymous]

Rates are actually very close and depending on your credit, ltv, etc, they may very well be lower for FHA. The difference is that you'll pay PMI with FHA. (Of course, you would with conventional as well if you put down less than 20%.)

[Anonymous]

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@Anonymous wrote:
Rates are actually very close and depending on your credit, ltv, etc, they may very well be lower for FHA. The difference is that you'll pay PMI with FHA. (Of course, you would with conventional as well if you put down less than 20%.)

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Nope.  If the LTV is less than 78% on an FHA then there is no "PMI" with FHA either on A 30 year loan... on a 15 year loan it's a 90% LTV 

[recoverychick]

My FHA rate was lower than the conventional rate.

[Anonymous]

Thanks for this post!  I didn't realize FHA had set rates no matter your FICO.