For years Conventional loans were considered the "best" loans, and there were good reasons.  However, due to the disgraceful abuses of Fannie Mae and Freddie Mac by their leadership and certain Congressmen and women, conventional loans have reverted back to what they were like in the 1960's and before; loans that require larger down payments and better credit scores.  For that, you can still pay a higher interest rate for a conventional loan.

Here are a few reasons why you would choose an FHA loan over a Conventional loan:

*  The minimum down payment for an FHA loan is 3.50%.  Many areas of Ohio (and the rest of the country) were classified as "Declining Markets", which means the minimum down payment for a conventional could be as much as  8-10% of the purchase price.  Although we can now do conventional loans with only 5% down, many lenders can't or won't.  But FHA is still the best option for most people.  

*  The interest rate for an FHA is typically lower than a Conventional loan.

*  Conventional loans require a 680 minimum credit score to do a minimum down payment loan (some programs or lenders require even higher credit scores).

*  FHA can require as little as a 620 minimum credit score.

*  Conventional loans require hefty add-ons to the interest rate for credit scores under 680.

*  FHA loans require much smaller add-ons to the interest rate and the threshold begins at a credit score under 620.

*  FHA loans allow 100% of the down payment on a minimum down payment loan to come through gifts or loans from a family member (s).  Conventional loans still require the minimum down to come from the buyer.

*  A parent or family member can co-sign for a buyer and FHA loans do not require the buyer to have ANY income to support the loan.  The co-signor can support the whole transaction.  A co-signor on a conventional loan can only have a very small impact on the debt to income ratios.

*  FHA loans allow higher debt to income ratios on minimum down payment loans than conventional loans.

*  The monthly Mortgage Insurance Premium (MIP) on a minimum down payment (3.50%) FHA loan is always .55% of the loan amount, even if you have a 620 credit score.

*  The monthly Private Mortgage Insurance (PMI) on a minimum down payment (5-10%)conventional loan is 1.07% and the minimum credit score is 680. 

*  The minimum down payment on an owner occupied 4 unit home on an FHA loan is 3.50%, and that can be a gift from family.  The minimum for a conventional loan would be 20% down and must be 100% from your own funds.

There are other examples but the comparison is extremely one-sided.  Lower interest rate; lower MIP; lower credit scores; etc.  It is clear why FHA loans are THE way to finance your home today.