An FHA loan is a mortgage insured by the Federal Housing Administration. FHA loans are commonly used by first-time buyers and borrowers who may need more flexible credit or down payment options.
How FHA loans work
FHA loans are offered by approved lenders and insured by the FHA. The insurance helps reduce lender risk, which can make FHA loans accessible to some borrowers who may not fit conventional loan requirements.
Who may consider an FHA loan?
- First-time homebuyers
- Borrowers with limited down payment savings
- Borrowers with moderate credit profiles
- Buyers purchasing a primary residence
- Borrowers who want to compare conventional and FHA options
What to consider with FHA loans
- Mortgage insurance is usually required
- Property must meet certain standards
- Loan limits may apply
- Primary residence occupancy is generally required
- Upfront and monthly mortgage insurance may affect cost
Want to compare FHA and conventional purchase options?
FHA vs. conventional
FHA loans may offer more flexible credit guidelines for some borrowers, while conventional loans may offer advantages for borrowers with stronger credit or larger down payments. The right option depends on the borrower's full profile and goals.
Understand your purchase loan options before choosing.
Get StartedFHA eligibility, mortgage insurance, property standards, loan limits, rates, and terms vary by lender, borrower profile, property, and FHA guidelines.