FHA Mortgage or home loans are insured by the Federal Housing Administration. It may be easier to qualify for an FHA mortgage than a conventional mortgage. Here are some of the reasons you might qualify for an FHA loan if you don’t qualify for a conventional loan.

Low down payment. The minimum down payment is 3.5%. Those funds can be a gift from a family member, charity, or your employer. Generally, a conventional loan requires 5% down.

More lenient credit guidelines. Credit (FICO) scores as low as 580 are accepted. You may qualify with an even lower score depending on other circumstances. Conventional loans often require a score of 620 or higher. FHA also allows you to obtain a loan in as little as 2 years out of bankruptcy or as little as 3 years out of foreclosure. The standard is 7 years for both on a conventional loan.

Higher debt-to-income (DTI) ratios. DTI is the amount of your monthly income that goes toward paying monthly debts. Conventional mortgages generally allow a lower percent while FHA allows for a little higher ratio.

Your experienced mortgage advisor can help you understand these differences. They will help determine which loan option is best for you.