FHA vs Conventional Loans: Which Is Right for You in 2026?

Choosing the Right Loan

One of the most common questions we get at The Taberne Group is: "Should I go FHA or conventional?" The answer depends on your financial situation.

FHA Loans at a Glance

FHA loans are backed by the Federal Housing Administration and are designed for borrowers who may not qualify for conventional financing.

Minimum credit score: 580 (3.5% down) or 500 (10% down)

Down payment: As low as 3.5%

Mortgage insurance: Required for the life of the loan (upfront + monthly)

Debt-to-income ratio: Up to 57% in some cases

Best for: First-time buyers, lower credit scores, limited savings

Conventional Loans at a Glance

Conventional loans are not government-backed and typically have stricter requirements but more flexibility.

Minimum credit score: Usually 620+

Down payment: As low as 3% (Conventional 97)

Mortgage insurance: Required if down payment is under 20%, but can be removed later

Debt-to-income ratio: Typically up to 45-50%

Best for: Strong credit, higher down payment, want to avoid permanent MI

The Key Differences

Our Recommendation

If your credit score is above 700 and you have at least 5% to put down, conventional is usually the better long-term choice because you can eventually eliminate mortgage insurance. If you're below 680 or have limited funds for a down payment, FHA might be your best path to homeownership.

Let Us Help You Decide

Every borrower's situation is unique. The Taberne Group will analyze your complete financial picture and recommend the loan program that saves you the most money over time.