First Time Home Buyer - Why NOT use FHA Insured Loan?

[Alex Bowen]

I'm a potential home buyer who is looking for a property to purchase as a residence. I have not yet talked to a mortgage broker on the availability of an FHA loan. I have, however, asked the advice of people in my life whose opinion I value.

One person in particular advised that it's always best to put at least 20% down and people who can't afford that have no business buying a house. He cites that the housing collapse a few years ago is partly because of irresponsible lending. Should I heed this advice and wait until I can put down a considerable amount?

There must be something I am missing in regards to an FHA loan. Are there any catches or stipulations (besides PMI) that I should be aware of? Why wouldn't I want to take advantage of this opportunity?