FHA Loans
Government-insured financing built for buyers with lower credit scores or a limited down payment, with more forgiving qualifying guidelines.
FHA Loans at a Glance
Program Highlights
✓ 10% down with 500-579 credit score
✓ 100% gift funds allowed for down payment
✓ Up to 6% seller concessions
✓ Rate pricing not tiered by credit score
✓ FHA limit: $541,287 – $1,249,125 by county
Who It's Best For
✓ Credit scores 580-679
✓ Borrowers with limited savings
✓ Recent credit events (shorter waiting periods)
✓ Higher DTI ratios (up to 57% with AUS)
✓ Using gift funds for entire down payment
How FHA Loans Work
The FHA Process
Pre-Approval
At 580+ you put 3.5% down. Between 500 and 579, 10% down. Gift funds can cover the entire amount.
Find Your Home
Negotiate up to 6% in seller concessions toward your closing costs.
FHA Appraisal
An FHA-assigned appraiser confirms value and checks minimum property standards.
Underwrite & Close
Automated underwriting allows DTI ratios up to 57%, well above most conventional limits.
Who FHA Works Best For
First-Time Buyers
The most forgiving entry point into homeownership, with the lowest credit and savings requirements.
Credit Scores 580–679
FHA typically prices better than conventional for borrowers below roughly 700.
Limited Savings
100% of your down payment can come from gift funds — no seasoned savings required.
Recent Credit Events
Shorter waiting periods after a bankruptcy, foreclosure, or short sale than conventional financing.
Andrew Baker · NMLS 2688601 · (949) 665-9090
Common Questions
What is the minimum credit score for an FHA loan?
FHA guidelines allow a score as low as 580 with a 3.5% down payment, and 500 to 579 with 10% down. Individual lenders often set higher overlays than FHA's published minimum, so the score that actually works depends on which lender the file is placed with and the rest of the profile.
How much down payment does an FHA loan require?
3.5% of the purchase price for borrowers at or above a 580 score. The down payment can come from your own funds, a documented gift from an eligible donor, or an approved down payment assistance program. Closing costs are separate, though sellers are permitted to contribute toward them within FHA limits.
Can I use an FHA loan for an investment property?
No. FHA financing is for owner-occupied primary residences, and you must intend to occupy the home. You can buy a two-to-four unit property with FHA and rent the other units while living in one. For a pure rental, a DSCR or conventional investment loan is the route instead.
What is the FHA loan limit for 2026?
The 2026 FHA floor for a one-unit property is $541,287, which applies in most counties. High-cost counties run higher, up to a ceiling of $1,249,125. Counties between the two are set at 115% of the local median home price. Multi-unit properties carry higher limits at every tier.
Does an FHA loan require mortgage insurance?
Yes. FHA loans carry an upfront mortgage insurance premium, which is usually financed into the loan, plus an annual premium collected monthly. On most FHA loans made with the minimum down payment, the annual premium stays for the life of the loan rather than dropping off at a set equity point.
Ready to Get Started?
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