FHA loans plummet in the Chicago Area is a recent article I saw that intrigued me. According to my
statistics FHA loans are running a little behind conventional financing in the Northwest Suburban area but 36% overall is quite a dip.
FHA a mortgage crutch? I think that phrase is somewhat jaded as we should be able to give buyers any and every type of financing to get them in a home in this market.
I think this article doesn't recognize the major contributor is the MIP charges for FHA have increased immensely and possibly make conventional financing a better deal for buyers with decent credit scores. Crunching those numbers with all factors being considered might make buyers throw FHA loans to the curb for a lower bottom line. You can't blame them! It's a 30 year payment.
But FHA loans will always be a better choice for those with obvious credit bumps and lower FICO scores. You have to weigh the pros and cons.
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A buyer with very good credit does have more options. The FHA program advantage for buyers with moderate credit scores will be smaller or no adjustments for credit scores.
Many of my buyers are finding that a conventional loan is cheaper in the long run.