February 23, 2011
FHA home loans differ from conventional loans in many ways. One of those differences is the amount of down payment required to purchase a home with an FHA insured loan. FHA loans, like their conventional counterparts, do not have a fixed dollar amount required as a down payment.
Instead, a percentage of the loan amount is calculated, based on the sale price of the property.
Conventional loan down payment requirements vary from company to company–you may be told by one lender that five percent is required, while another may ask for 10%.When it comes to FHA loans, the traditional down payment amount is 3.5% of the contract sales price of the home.
In cases where the buyer wants to purchase a HUD-owned home (a property that has been repossessed by HUD and put back on the market) the
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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