The Differences in Qualifying. Just like a standard conventional and FHA loan, there are differences between the two programs. The Fannie mae program requires stricter underwriting guidelines because it is a conventional loan. The FHA 203K loan has looser underwriting guidelines, but has more property restrictions than the Fannie Mae program.
Do you know the difference between an FHA Appraisal & Conventional Appraisal? FHA and conventional appraisals used to have vastly different guidelines and requirements. Over the last few years, the industry as a whole has tightened appraisal guidelines, while FHA loosened theirs in 2005.