Beauty of FHA loans

FHA loans are designed to make homeownership more accessible — especially if your credit isn’t perfect or your down payment is limited. Insured by the Federal Housing Administration, these loans are one of the most popular options for first-time buyers. Generally speaking, FHA loans might be a good fit if you have less money set aside to fund your down payment and/or you have a below-average credit score. While low down payment minimums and competitive interest rates are still possible with a conventional loan, you’ll need to show a strong credit score to qualify for those advantages.

Each loan type has advantages and disadvantages—including different mortgage insurance requirements, loan limits, and property appraisal guidelines—so choosing the one that works best for you really depends on your financial profile and your homebuying priorities.

How FHA Loans Work

FHA loans allow lenders to offer more flexible qualifications because the loan is backed by the government.

Basic Requirements

• Credit score: 580+ (lower possible with higher down payment)

• Down payment: 3.5% minimum

• Primary residence only

• Flexible debt-to-income ratios

What Makes FHA Loans Unique

• Easier approval compared to conventional loans

• More forgiving credit guidelines

• Great stepping stone into homeownership