FHA loans fit buyers with lower credit scores or small down payments, since HUD accepts scores as low as 580 with 3.5% down. Conventional loans often cost less over time when your credit is strong. In Tampa, an FHA appraisal also checks the house against HUD's property standards, which can flag repairs on a 1920s Seminole Heights bungalow.
How FHA and Conventional Loans Differ
FHA loans are insured by the federal government, and under HUD's FHA single family handbook you can qualify with a credit score as low as 580 and 3.5% down, or 500 to 579 with 10% down. The cost of that flexibility is mortgage insurance, an upfront premium plus a monthly one, and with less than 10% down the monthly premium stays for the life of the loan.
Conventional loans follow Fannie Mae and Freddie Mac guidelines and usually want a higher score, but their private mortgage insurance has an end date, since the Consumer Financial Protection Bureau says it ends automatically at 78% of the home's original value if you're current on payments. For rates, county limits and the mortgage insurance math, the Tampa FHA loan guide goes deeper, and our post on FHA land and construction loans covers building from scratch.
What a Tampa Seller Sees in an FHA Offer
Sellers care about loan type because of the appraisal. An FHA appraisal also checks the home against minimum property standards, so items like peeling paint on an older house, a missing handrail or a safety issue can turn into required repairs before closing.
That matters most on Tampa's older houses. The city's design guidelines for the Seminole Heights Historic District describe a large concentration of bungalow-style homes from the 1910s and 1920s, and chipped paint, older wiring or a worn roof on a house that age is the kind of item an FHA appraisal can turn into a required repair. The year built for any Hillsborough home is on its record at hcpafl.org, so you'll know what you're offering on before the appraiser does.
Condos get a second check. An FHA loan on a condo generally needs the building on HUD's approved list, and HUD's condominium search filters by state and county, so your agent can confirm a Pinellas tower's status before you write the offer instead of finding out from the lender. FHA also caps the loan amount by county, and HUD's mortgage limits lookup shows the current figure for Hillsborough and Pinellas.
Required repairs can make some sellers of older homes nervous, especially when they have more than one offer. The fix is a strong file and a plan for likely repairs, and our guide on how to make a competitive offer in Tampa covers how to present it.
In practice, the quality of your approval often outweighs the loan type. A fully verified FHA buyer can look stronger than a conventional buyer with a quick pre-qualification, and your agent should explain that difference to the listing side.
How to Choose Between FHA and Conventional
Start with your credit score and how much cash you can put down without draining your savings. If your score is on the lower side or your down payment is small, FHA may be the loan that gets you into a home now.
If your score is strong and you can put down a few percent or more, ask for a Loan Estimate on both loans and compare the monthly payment, the mortgage insurance and how long you'll pay it. Our mortgage calculator helps you test different down payments before you talk to a lender.
Think about how long you'll stay, too. If you expect to sell or refinance within a few years, the gap between the two loans may be small, and if you're staying put for the long haul, the end date on conventional mortgage insurance can be worth a lot.
Frequently asked questions
Do sellers in Tampa accept FHA offers?
Yes, and the FHA appraisal is what a seller weighs. On an older Tampa house, like a Seminole Heights bungalow, it can turn condition items into required repairs, and a condo needs to be in a HUD-approved building, so a verified approval and a plan for repairs make your offer easier to accept.
What credit score do I need for an FHA loan in Florida?
FHA guidelines allow a score as low as 580 with 3.5% down, or 500 to 579 with 10% down. Individual lenders can set higher minimums, so ask what yours requires.
Does FHA mortgage insurance ever go away?
If you put down less than 10%, the annual premium lasts for the life of the loan. With 10% or more down, it ends after 11 years, and you can also refinance into a conventional loan once you have enough equity.
When does PMI come off a conventional loan?
You can ask your servicer to cancel it once your balance is scheduled to reach 80% of the home's original value. It ends automatically at 78% if you're current on your payments.