What an FHA loan actually is

An FHA loan is a mortgage insured by the Federal Housing Administration. It permits lower down payments and more flexible credit guidelines than conventional underwriting. FHA is for primary residences only — it is not an investment-property program.

FHA requirements

  • 3.5% minimum down payment at a 580 credit score or above.
  • Down to a 500 credit score with 10% down.
  • Debt-to-income ratios up to 50% with compensating factors.
  • Owner-occupied primary residence only.
  • Mortgage insurance required — an upfront premium plus a monthly premium.

FHA against conventional

FHA carries lower credit thresholds and a smaller down payment. Conventional carries removable mortgage insurance: PMI comes off at 80% loan-to-value, while FHA's annual premium stays for the life of the loan on most terms unless you refinance out of it.

That makes this a holding-period question, not a rate question. Run both structures against how long you actually expect to keep the loan before you decide.

Run the numbers before you talk to anyone

Nothing on this page is a quote. The calculators carry the same assumptions block a Loan Estimate does, so what you see there is comparable to what a lender will hand you.

Want the FHA numbers for Park Ridge run properly?

Send the purchase price, down payment, and credit range. You get the FHA structure compared against conventional, including what mortgage insurance costs you over your expected holding period.

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FHA Loans in other markets

All 33 markets we publish, not a selected eight.

The same city, a different product

Program parameters on this page (down payment minimums, credit thresholds, debt-to-income ceilings) are agency guidelines and change. Nothing here is a rate quote, an offer, or a commitment to lend.