[quote=recordsclerk]FHA buyers have fewer homes to choose from. Many foreclosures cannot go FHA due to the 90-day rule. In addition, FHA buyers have to bid higher to get the same house over a conventional buyer. You can add this to the opportunity cost of going with FHA. Not only is there a financial cost, but there is a potential lose of quality.[/quote]

Good point. But aren’t most of the foreclosures going to all-cash buyers who then flip it to someone with a government-backed loan? Or, are people with conventional loans and 20% down also able to compete in the foreclosure market?