Use "Yours sincerely" when you are of equal status, eg. potential business partners, or a supplier and client. Use "Yours faithfully" when the person is of a higher status than you, eg. the other person is in a position of authority, or if you are applying for a job.

They're mostly interchangeable valedictions; you can use either one. I'd recommend saving "yours faithfully" to close friends or family, however, because it's a tad bit more personal. That all being said, most English speakers just end letters with, "Sincerely,".