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You can now get a conventional loan with a minimum down payment of 3%.   This program is called FLEX 97%.  This is a great program for a coupe reasons:

• You only need a down payment of 3% vs 3.5% required by a FHA loan
• The max loan is $417k vs a max loan amount of $271k with a FHA loan
• This does not pulling the spouse's credit report.  Unlike a FHA loan that requires the spouse's debts be included in the total debts for calculating purposes. 
• If you currently have a FHA mortgage you can qualify for this loan.  While you would most likely not qualify for a new FHA loan, if you are retaining your current FHA loan
• There is no Upfront Mortgage Insurance fee as there is with a FHA loan.  This amount is usually 1% of your loan amount rolled into your loan. 

While there are benefits to this loan.  There are also down sides.  Here they are:

• This program only allows the seller to pay 3% toward your closing costs.  Unlike a FHA loan that will allow up to 6%.
• The maximum debt ratio is 41%.  While a FHA loan will allow up to 50% .
• Condos are not allowed on this program
• Min credit score of 720.  While FHA loans allow you to go down to 640 and in some cases as low as 580.  580 Guidelines
• The rate maybe slightly higher then a FHA loan and higher then the current market rate for a conventional loan with a larger down payment. 

This program may or may not be the best mortgage program for you, but it is important to know your options.   Call me today to make sure you get the best mortgage possible.