FHA Loan

A mortgage insured by the Federal Housing Administration, designed for low-to-moderate income borrowers with less stringent credit requirements.

What Is A FHA Loan?

FHA loans are mortgage loans insured by the Federal Housing Administration. They are designed for first-time homebuyers or those with low to moderate incomes who may not qualify for traditional mortgage loans. You do not have to be a first-time homebuyer to use these loans. FHA loans have lower down payment requirements (as low as 3.5% of the purchase price) and more flexible credit and income requirements compared to conventional loans. They also have a lower interest rate and may allow for a higher debt-to-income ratio. However, FHA loans do require mortgage insurance premiums, which adds to the overall cost of the loan. If you are considering buying a home and don’t have a lot of money saved for a down payment, an FHA loan may be a good option for you.

The Benefits of FHA Loans

  • Low down payment requirement
  • Flexible credit score requirements
  • Lower interest rates
  • Seller can contribute to closing costs
  • Multiple loan term options

Who Should Consider a FHA Loan?

  • First-time home buyers
  • Borrowers with low credit scores or limited credit history
  • Borrowers with low down payment funds

Eligibility Guide

  • Be a US citizen or have a valid US work visa
  • Have a valid Social Security number
  • Have a steady income and employment history
  • Have a credit score of at least 500
  • Have a down payment of at least 3.5% (can be gifted by a relative)
  • Meet certain requirements for the property, such as it being your primary residence and meeting minimum standards for health and safety

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