FHA Loans
Government-backed financing with low down payment and flexible credit guidelines.
Program Overview
FHA loans are insured by the Federal Housing Administration (FHA) and offered by FHA-approved lenders. Because the government backs the loan, lenders can offer more flexible qualification requirements — making FHA a popular choice for first-time buyers and those rebuilding credit.
FHA loans allow down payments as low as 3.5% for borrowers with a 580+ credit score, and up to 10% down for scores between 500–579. They also allow higher debt-to-income ratios than conventional loans, making it easier to qualify even with existing debts.
At a Glance
Who May Qualify
- Minimum 580 credit score for 3.5% down (500–579 with 10% down)
- Steady employment history — typically 2 years in the same field
- Must be purchasing a primary residence (owner-occupied only)
- Debt-to-income ratio up to 57% in some cases
- Must meet FHA property standards — home must pass FHA appraisal
- No minimum income requirement — but must demonstrate ability to repay
- Can use gift funds for down payment
Advantages
- Low 3.5% down payment
- Flexible credit requirements — scores as low as 580
- Higher DTI limits than conventional
- Gift funds allowed for entire down payment
- Competitive interest rates
- Available in all 50 states
Considerations
- Requires both upfront and annual mortgage insurance premium (MIP)
- Annual MIP lasts the life of the loan (if < 10% down)
- Lower loan limits in some counties
- Property must meet FHA minimum standards
- Cannot be used for investment properties
FHA loan guidelines, limits, and requirements are subject to change. Contact a licensed FHA-approved lender for current program details and to determine eligibility.
Ready to See If You Qualify?
Get a free personalized review from Alberto Cruz — a licensed loan officer who works with all of these programs daily.