FHA Home Loans (HUD)

About This Program

FHA loans are government-backed mortgages insured by the Federal Housing Administration, offered through private FHA-approved lenders. The key advantages over conventional loans are the lower minimum down payment (3.5% for borrowers with credit scores of 580 or higher, or 10% for scores of 500-579), more flexible debt-to-income requirements, and more forgiving credit history standards. These features make FHA loans one of the most common paths to homeownership for first-time buyers and those rebuilding credit. The trade-off for lower down payment and looser credit standards is mortgage insurance. All FHA loans require an upfront mortgage insurance premium (1.75% of the loan amount, typically rolled into the loan) and an annual mortgage insurance premium paid monthly. Unlike private mortgage insurance on conventional loans, FHA mortgage insurance cannot be automatically canceled once you reach 20% equity — it typically continues for the life of the loan unless you refinance. FHA loans can be used to purchase a primary residence (1-4 units) or to refinance an existing mortgage. They are not available for investment properties. Property condition requirements are stricter than for conventional loans — the home must meet FHA minimum property standards, which means a seller may need to address certain repairs before closing. FHA loan limits vary by county, set annually by HUD based on local median home prices. In high-cost areas, limits are substantially higher than the standard national limit. Check HUD's loan limit lookup tool at hud.gov before starting your home search to understand your maximum loan amount.

Eligibility Requirements

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