Part of the cluster
First-Time Buyers services →Almost every first-time buyer I work with in Brighton, Thornton, or Commerce City asks the same question in the first call: FHA or conventional? The honest answer is it depends, but the variables are not as mysterious as lenders sometimes make them sound.
FHA in plain English
- 3.5% down with a credit score of 580+.
- Mortgage insurance for the life of the loan in most cases (annual MIP plus an upfront fee).
- More forgiving on credit history, debt-to-income, and recent collections.
- Loan limits in the Denver metro are high enough to cover most starter homes.
Conventional in plain English
- As little as 3% down for first-time buyers (HomeReady / Home Possible programs).
- Private mortgage insurance (PMI) drops off automatically at 78% loan-to-value.
- Tighter credit requirements: typically 620+ minimum, better pricing at 680+ and 740+.
- Generally cheaper over the life of the loan if you can qualify.
When FHA is the right answer
Credit in the high 500s to low 600s. Recent credit events (medical collections, a late payment two years ago). High debt-to-income that conventional underwriting will not stretch around.
Also: condos that are FHA-approved when conventional financing on the same building is harder to source.
When conventional wins
Credit 680+ and clean. The PMI on a 5-10% down conventional loan is almost always cheaper than FHA's MIP, and it goes away. Over a 7-year hold that difference is real money.
Stacking Adams County HOPE
Adams County HOPE provides down payment assistance up to a percentage of the loan amount and works with both FHA and conventional. Income limits apply and they update annually. I keep current on which lenders close HOPE loans cleanly: it is not every lender.
If you are buying in Brighton, Thornton, Commerce City, Westminster, or Northglenn, this is worth a 15-minute conversation before you assume you need 20% down.
About the author
Maddie Cowger is a bilingual (English + Spanish) Realtor with eXp Realty serving the Denver and Boulder metro. SRES- and SFR-certified, with a marketing background that predates her real estate career. Read her story or book a no-pressure call.
