@NC_Mtg_Loaner wrote:
This is true, however, HUD subsidizes the primary note rate which often helps keep the APR low when compared to conventional or conforming loans, so be sure to compare quotes from your lender for each program. Often times the difference in APR is marginal and may be even less than .5%.
Considering that interest rates are STILL at record lows, the difference between the loan programs (again, look at the APRs on FHA vs. Conventional) may be irrelevant in the long term---especially if you ever consider paying additional principal on your loan before the interest accrues to your loan.
Every little bit helps. If there's any requirement around the type of property with FHA (which I thought there was, especially for more expensive properties), it would make that route all but impossible. That's why I've just stuck with conventional - I thought the FHA/USDA mortgages are really meant for first-time buyers or those with low/no cash with which to make a down payment.
For me, the mortgage is basically to supplement what I can't pay cash for. I'm paying extra to the principle every month on our current property, but that would possibly change on our next one as we'll be taking out a potentially larger mortgage to cover the difference. We would, however, be putting down around 60-80%, so the idea of paying insurance on a 20-40% LTV mortgage is a bit ridiculous.
