What Is an FHA Mortgage?
Why Choose an FHA Loan?
FHA loans are ideal for buyers who need a more flexible path to homeownership. Benefits include:
- Down payments as low as 3.5%
- Credit scores as low as 580
- More lenient income and debt requirements
- Assumable loans, which can be transferred to a future buyer
- Streamlined refinance options for current FHA borrowers
Types of FHA Mortgage Options
FHA Purchase Loans
The standard FHA loan for buying a primary residence. It allows low down payments and accepts various income sources to help borrowers qualify.
Ideal for: First-time buyers and those with moderate to low credit scores or those with a “not so clean” credit history (e.g. collections or late payments)
FHA 203(b) Loan
This is the most common type of FHA loan for purchasing or refinancing a single-family home. It covers the basics and allows a fixed or adjustable rate.
Ideal for: Most homebuyers seeking affordable, flexible terms.
FHA 203(k) Rehabilitation Loan
The 203(k) loan combines the cost of purchasing a home with the cost of renovations or repairs—rolled into one convenient mortgage.
Ideal for: Buyers purchasing a fixer-upper or homeowners planning major renovations.
FHA Streamline Refinance
A simplified refinance option for current FHA borrowers. It typically requires no income verification, no appraisal, and minimal paperwork.
Ideal for: FHA homeowners looking to lower their monthly payments quickly.
FHA Loan Requirements
To qualify for an FHA mortgage, you’ll typically need:
- Minimum credit score of 580 (sometimes we can go to 550 with a higher down payment)
- Down payment as low as 3.5%
- Allows for a higher debt to income ratio – max 47/57 front end/back end
- Steady income and/or employment history (no job gaps over 6 months)
- The home must be your primary residence
FHA Loan Limits (2025)
FHA loan limits vary by county and are based on local home prices. In most areas for 2025:
- Low-cost area limit: $524,225 for a single family (higher for 2, 3 or 4 unit properties)
- High-cost area limit: Up to $1,149,825
FHA vs. Conventional Loans
Down Payment
As low as 3%
Yes (MIP for life unless you put down greater than 10%)
Is an FHA Loan Right for You?
If you have a limited down payment, a lower credit score, a few late payments or collections, or you’re a first-time homebuyer, an FHA loan can be a smart, affordable path to owning your home. Plus, with multiple FHA loan options, there’s likely a solution to fit your needs.
Get Started with an FHA Loan Today
Whether you’re buying your first home, renovating a fixer-upper, or refinancing your current mortgage, our expert loan officers are ready to guide you.
