FHA Loans: Homeownership Made Accessible

Low down payment (3.5%), flexible credit requirements, and first-time buyer friendly. FHA loans help you get started with less.

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What Is an FHA Loan?

FHA (Federal Housing Administration) loans are government-backed mortgages designed to make homeownership more accessible. They require lower down payments and accept lower credit scores than conventional loans.

FHA loans are insured by the government, which allows lenders to offer more flexible terms to borrowers who might not qualify for conventional financing.

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Key Benefits

Why Choose an FHA Loan?

Low Down Payment

- Put down as little as 3.5% with a credit score of 580+. Even 10% down is lower than many conventional requirements.

Flexible Credit Requirements

Minimum 580 credit score (500 with 10% down). More forgiving of past credit issues. Shorter waiting periods after bankruptcy or foreclosure than conventional.

Higher Debt-to-Income Ratios

DTI up to 50% may be acceptable. Easier to qualify with existing debts.

Gift Funds Welcome

100% of the down payment can come from funds gifted from your family. No minimum borrower contribution required.

Assumable Loans

FHA loans can be transferred to future buyers. That means if someone buys your home in the future, they can take over your mortgage.

Is an FHA Loan Right for You?

Good fit if you:
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✓ Have limited savings for a down payment (3.5% minimum)
✓ Have a credit score between 580-680
✓ Are a first-time homebuyer
✓ Have higher debt-to-income ratio
✓ Have recent credit challenges (bankruptcy, foreclosure)
✓ Want to use gift funds for your down payment

Might not be the best fit if:

You have 20%+ to put down (conventional may be cheaper long-term)
You have 740+ credit (conventional rates may be better)
The home needs major repairs (FHA has strict property standards)
You're buying a high-value home (FHA has loan limits)

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FHA Loan Requirements

Credit Score

Minimum 580 qualifies for 3.5% down; 500–579 requires 10% down; recent credit issues are reviewed case‑by‑case.

Down Payment

3.5% with 580+ credit or 10% with 500–579, and funds can be 100% gifted from family.

Debt-to-Income Ratio (DTI)

Up to 43% standard, up to 50% with compensating factors.

Property Appraisal

Must be a primary residence that meets FHA minimum property standards and passes an appraisal for safety and livability.

Income & Employment

Stable employment history (2+ years preferred)
Verifiable income through pay stubs, W-2s, tax returns
Self-employed: 2 years of tax returns required

FHA Mortgage Insurance Explained

Unlike conventional PMI, FHA requires two types of mortgage insurance.

Upfront Mortgage Insurance Premium (UFMIP)

1.75% of the loan is due at closing, can be rolled into the loan, e.g., a $300,000 loan pays $5,250.

Annual Mortgage Insurance Premium (MIP)

0.45–1.05% of the loan per year, billed monthly, varies by loan size/down payment/term, e.g., $300,000 × 0.85% = $2,550/year = $212.50/month.

FHA Loan Limits by County

FHA loan limits vary by county and are updated annually.

Standard Limit

$498,257 (most counties)

High-Cost Areas

Up to $1,149,825

Types of FHA Loans

Standard FHA Purchase Loan

Buy a primary residence with 3.5% down

FHA Streamline Refinance

Refinance an existing FHA loan with minimal paperwork and no appraisal (usually)

FHA Cash-Out Refinance

Refinance to access home equity, up to 80% loan-to-value.

FHA 203(k) Rehabilitation Loan

Finance home purchase AND renovation costs in one loan. Perfect for fixer-uppers

How to Get an FHA Loan

Step 1

Get Pre-Approved

We'll review your credit, income, and assets for FHA eligibility.

Step 2

Find an FHA-Approved Home

The property must meet FHA minimum standards and appraise appropriately.

Step 3

FHA Appraisal

An FHA appraiser will inspect the home for safety and livability issues.

Step 4

Underwriting

We'll submit your full application for FHA approval.

Step 5

Close on Your Home

Sign documents and move in within 30-45 days from starting the process.

FHA Loan FAQs

Yes, but the condo complex must be FHA-approved. We can help you check approval status.

Typically 2 years after a Chapter 7 bankruptcy discharge, 1 year after Chapter 13 with court approval and payment history.

Generally no—FHA loans are for primary residences and you can only have one at a time, with some exceptions (job relocation, growing family).

The seller must make required repairs before closing, or you can choose to walk away with your earnest money.

Not immediately—you must occupy it as your primary residence for at least one year. After that, you can rent it out.

If you put down less than 10%, the only way to remove MIP is to refinance to a conventional loan once you have 20% equity.

Get Started With an FHA Loan Today

See if you qualify for an FHA loan with our simple pre-approval process.