Best for
Buyers rebuilding credit or short on down payment who need approval flexibility.
- 3.5% down with a 580 score (10% from 500–579)
- More forgiving of past credit events
- Gift funds allowed for the full down payment
Mortgage insurance to know about
FHA charges an upfront premium of 1.75% of the loan amount (usually financed) plus an annual premium collected monthly. With less than 10% down, that annual premium stays for the life of the loan — which is why many FHA borrowers refinance to conventional once they reach 20% equity.
Property requirements
The appraiser checks minimum property standards: working systems, safe roof, no peeling paint on older homes, and secure handrails. Fixer-uppers may need repairs before closing or an FHA 203(k) renovation loan instead.
Loan limits
FHA limits vary by county and update annually. In higher-cost markets the ceiling is substantially above the national floor, so the limit that applies to you depends on the county you're buying in.