The major advantage to the borrower has changed in recent years. At one time, the low down payment was the major advantage. Now, the major advantage in qualifying for a loan is that FHA standards for approving a borrower for loans requiring little or no down payment are more liberal than those of conventional lenders.
When qualifying a borrower’s income, FHA allows coborrowers who do not occupy the property to have their income count in the qualification process. FHA also allows gifts for closing costs that conventional lenders would not.