Federal Housing Administration Loan

An FHA Loan is a home mortgage backed by the Federal Housing Administration (FHA) designed to make homeownership more accessible for borrowers with lower credit scores, smaller down payments, or limited credit history.

Because the loan is government-insured, lenders can offer more flexible qualification guidelines and competitive interest rates, helping more people achieve the dream of homeownership.

How an FHA Loan Works

With an FHA loan, you borrow from a private lender just like a conventional mortgage but the loan is insured by the FHA, protecting the lender in case of default. This added security allows for easier qualification standards and lower upfront costs for many buyers.

FHA loans are available in both fixed-rate and adjustable-rate options, typically with terms of 15 or 30 years.

Benefits of an FHA Loan

Low Down Payment

Buy a home with as little as 3.5% down, making it ideal for first-time buyers or those without large savings.

Easier Credit Qualification

FHA loans are more forgiving of lower credit scores and past financial challenges than conventional loans.

Competitive Interest Rates

Because of government backing, lenders often offer attractive rates, even for borrowers with modest credit.

Flexible Debt-to-Income Ratios

You may still qualify even if your monthly debt obligations are higher relative to your income.

Streamlined Refinancing Options

The FHA Streamline Refinance program lets you quickly refinance to a lower rate — often with less paperwork and no appraisal.

Things to Consider

  • Mortgage Insurance is required: FHA loans include both an upfront mortgage insurance premium (UFMIP) and an annual mortgage insurance premium (MIP) added to your monthly payment.

  • Loan Limits Apply: The maximum loan amount depends on your county and property type.

  • Primary Residences Only: FHA loans are limited to homes you live in as your primary residence (not second homes or investment properties).

Is an FHA Loan Right for You?

An FHA loan may be the perfect fit if you:

  • Are a first-time homebuyer or have limited savings

  • Have a credit score of 580 or higher

  • Want a low down payment option

  • Plan to live in the home as your primary residence