What are FHA Loans?

Since 1934, FHA loans have helped millions of homebuyers become homeowners. Insured by the Federal Housing Administration (FHA), these loans typically have lower down payments and more flexible credit requirements than non-government-backed loans.

Highlights of an FHA Loan:

  • As low as 3.5 percent down payment allowed
  • Down payment can be gifted from a relative, borrowed from an eligible 401K or provided through an approved state or local program
  • Co-signers are allowed (but must be eligible borrowers)
  • Seller can contribute up to 6% of the purchase price toward closing costs
  • Two types of mortgage insurance (MI) are required:
    • Upfront MI – can be financed into the loan or paid in cash
    • Annual MI – paid monthly as part of the mortgage payment
  • Available only for financing a primary residence
  • Minimum 580 credit score with AUS approval
  • Loan limits may vary by State/County
    • Arizona, Maricopa County loan limit = $368,000**

*Not all borrowers with 580 credit scores will qualify.
**As of January 2021.

FHA Loan Resources

How do I apply for an FHA loan?
How Do I Apply for an FHA Loan?
Conventional Loans vs FHA Loans | What is the Difference?
Conventional Loans vs FHA Loans | What is the Difference?
Mortgage Loan Calculator