You’ve spent months on real estate websites and toured dozens of properties. You’ve finally found the right house in the right location for the right price… You’ve spent months on real estate websites and toured dozens of properties. You’ve finally found the right house in the right location for the right price and your offer has been accepted. Now you have to select the method to finance your purchase, and for most first-time buyers there are two main options – an FHA or a conventional mortgage. An FHA loan is guaranteed by the Federal Housing Administration, part of the Department of Housing and Urban Development (HUD). If you qualify for an FHA mortgage, the U.S. government guarantees to the lender that the loan will be repaid. The loan has some advantages and disadvantages for the borrower. The first is that it is easier to qualify for an FHA loan than it is a conventional mortgage. Because it is a program to encourage homeownership, and the government stands behind the loan, a borrower may qualify with less than perfect credit. While overall lending requirements are much tighter in the wake of the housing crash, FHA requirements are a bit less ...