FHA Loans
Government-insured loans with flexible qualifying guidelines.
Overview
FHA loans are insured by the Federal Housing Administration, which allows lenders to offer more flexible qualifying guidelines than many conventional programs. That combination of a lower down payment threshold and more forgiving credit standards has made FHA a common starting point for first-time and repeat buyers alike, though it does come with mortgage insurance premiums that apply for some or all of the loan term.
Who It’s For & What You’ll Need
- A down payment as low as 3.5% for borrowers who meet the qualifying credit score threshold under FHA guidelines
- Both an upfront and an annual mortgage insurance premium (MIP), which factor into your total payment
- A property that meets FHA minimum property standards, confirmed through an FHA appraisal
- The home must generally be your primary residence
- A qualifying debt-to-income ratio under FHA guidelines
Benefits
- A lower down payment threshold than many conventional loan programs
- More flexible credit score guidelines than many conventional options
- Sellers may contribute toward closing costs up to FHA-allowed limits
- FHA loans are assumable, meaning a future buyer may be able to take over your loan and rate, subject to lender approval
Common Scenarios
- A first-time buyer with a moderate down payment savings and a solid but not perfect credit history.
- A buyer rebuilding their credit after a past financial setback who needs more flexible qualifying guidelines.
- A repeat buyer taking advantage of FHA’s flexible debt-to-income guidelines while managing other financial obligations.
Frequently Asked Questions
What credit score do I need to qualify for an FHA loan?
FHA guidelines allow lower minimum credit scores than many conventional programs, with the lowest down payment tiers requiring higher scores than the program’s absolute floor. Exact requirements can also vary by lender overlay, so it’s worth having your specific profile reviewed.
Is FHA only for first-time homebuyers?
No. FHA loans are available to any qualifying buyer, though first-time buyers are drawn to the program often because of its lower down payment and more flexible credit standards.
What is mortgage insurance premium (MIP), and can it be removed?
MIP is insurance that protects the lender if you default, and it includes both an upfront premium and an annual premium paid monthly. Depending on your down payment and loan term, MIP may last for the life of the loan or may be removable after a set period — current FHA rules should be confirmed at the time you apply.
Are there limits on how large an FHA loan can be?
Yes. FHA sets maximum loan limits each year that vary by county based on local home values. We can confirm the current limit for the county where you’re buying.
Related Calculators
Run your own numbers before you apply:
Ready to Move Forward with FHA Loans?
Start your application, or talk it through with a loan officer first — whichever fits where you are.