FHA Loans

3.5% down. 580 credit score. Your clearest path to homeownership if you are just starting out or rebuilding.

FHA loans open the door for buyers who do not qualify for conventional financing. We access multiple lending partners to get you the most competitive FHA rates available, not just what one bank offers.

3.5%
Minimum down payment with 580+ credit
580+
Minimum credit score to qualify
21
Average days to close with Invest West
3.5%
Min Down Payment
580+
Min Credit Score
Up to 57%
Max DTI Ratio
$541,287
2026 FHA Limit Most Counties
The Basics

What Is an FHA Loan?

An FHA loan is a mortgage insured by the Federal Housing Administration. Because the government backs the loan, lenders can offer more lenient qualification standards, including lower credit scores and smaller down payments than most conventional loans require.

FHA loans are one of the most popular choices for first-time homebuyers, but they are available to anyone who meets the qualifications, whether it is your first purchase or your fifth.

We access multiple lending partners to find the best FHA rate available, often beating what big banks advertise publicly.

Low Down PaymentAs little as 3.5% down for borrowers with a 580+ credit score. 10% down if your score is between 500 and 579.
Flexible Credit StandardsFHA accepts credit scores as low as 580 for the minimum down payment. Conventional loans typically require 620 or higher.
Gift Funds AllowedYour entire down payment can come from a gift from a family member, employer, or approved charity. Conventional loans have restrictions on this.
Higher DTI ToleranceFHA allows debt-to-income ratios up to 57% in some cases, making it easier to qualify if you carry existing debt.
Streamline Refinance AvailableOnce you have an FHA loan, a future FHA Streamline Refinance can lower your rate with minimal paperwork and no appraisal required.
Qualification

FHA Loan Requirements

FHA guidelines are set by HUD. Here is what most borrowers need to qualify.

Credit Score

580+

A 580 credit score qualifies for the 3.5% down payment. Scores between 500 and 579 require 10% down. Below 500 does not qualify for FHA financing.

Down Payment

3.5%

Just 3.5% down for borrowers with 580+ credit. The down payment can come from personal savings, gifts, or approved down payment assistance programs.

Debt-to-Income

Up to 57%

FHA allows higher DTI than conventional loans. With strong compensating factors like solid reserves or overtime income, ratios above 50% can be approved.

2026 Loan Limit

$541,287

The 2026 FHA loan limit in most U.S. counties. High-cost areas go up to $1,249,125. Exact limit varies by county.

Employment

2-yr History

FHA requires a 2-year employment history. Job changes are acceptable as long as income is stable or increasing and you stay in the same field.

Property

Primary Only

FHA loans are for primary residences only. The property must meet FHA minimum property standards, which are stricter than conventional appraisal requirements.

Why FHA

Advantages of FHA Loans

FHA loans open the door to homeownership for buyers who might not qualify for conventional financing.

Lowest Down Payment Available

3.5% down is one of the lowest options available for a non-VA, non-USDA purchase. For a $400,000 home that is just $14,000 out of pocket.

More Lenient Credit Standards

FHA is the most accessible loan type for buyers rebuilding credit or with limited credit history. A 580 score qualifies for the best FHA terms.

Co-Borrower Flexibility

FHA allows non-occupant co-borrowers, meaning a parent can help a child qualify without living in the home. This is not allowed on most conventional loans.

Competitive Interest Rates

Because FHA loans are government-backed, lenders price them aggressively. Borrowers with lower credit scores often get a better rate on FHA than conventional.

Assumable Loan

FHA loans can be assumed by a future buyer when you sell. If rates are higher in the future, an assumable FHA loan at today's rate is a significant selling advantage.

Streamline Refinance Option

FHA Streamline Refinances let you lower your rate quickly with minimal documentation and no new appraisal once you are in the loan.

Side by Side

FHA vs. Conventional vs. USDA

FeatureFHAConventionalUSDA
Min. Down Payment3.5%3% to 5%0%
Min. Credit Score580620640 typically
Mortgage InsuranceRequired life of loan (under 10% down)Drops at 20% equityAnnual fee, no upfront PMI
Upfront Premium1.75% of loan amountNone1% guarantee fee
Property LocationAnywhereAnywhereRural and suburban areas only
Income LimitsNoneNoneYes, varies by county
The Process

How to Get an FHA Loan

The FHA process is straightforward. We handle the details so you can focus on finding your home.

1

Free Consultation

We review your credit, income, and goals, confirm you meet FHA guidelines, and show you exactly what you can afford.

2

Same-Day Pre-Approval

We compare FHA lending partners and issue your pre-approval letter, typically the same business day you submit your documents.

3

Find Your Home

Shop with confidence knowing your financing is in place. We work with your realtor to make sure the property meets FHA standards before you go under contract.

4

Close in 21 Days

We manage underwriting, the FHA appraisal, and all lender communications so your closing happens on time.

Common Questions

FHA Loan FAQs

Can I get an FHA loan with a 580 credit score?
Yes. A 580 credit score qualifies you for FHA's minimum 3.5% down payment. Scores between 500 and 579 require 10% down. If your score is below 580, ask us about a rapid rescore strategy that may be able to get you above the threshold quickly.
How much does FHA mortgage insurance cost?
FHA has two components of mortgage insurance. First is an upfront mortgage insurance premium of 1.75% of the loan amount, which is typically rolled into the loan. Second is an annual MIP of 0.55% for most borrowers with 3.5% down on a 30-year loan, paid monthly. Unlike conventional PMI, FHA MIP stays for the life of the loan if you put less than 10% down.
Can I use gift funds for my FHA down payment?
Yes. Your entire FHA down payment can come from a gift from a family member, close friend, employer, labor union, or approved charitable organization. The gift giver must provide a letter confirming the funds are a gift and not a loan, and We can walk you through the documentation requirements.
Is an FHA loan better than conventional for first-time buyers?
It depends on your credit score and down payment. If your score is below 620, FHA is almost always the better choice. If your score is 620 or above and you have at least 5% to put down, conventional may save you money long term because PMI eventually goes away. We will run both scenarios for your exact numbers.
Can I refinance out of my FHA loan later?
Yes, and many borrowers do this once they build enough equity. Once your home reaches 20% equity, you can refinance into a conventional loan and eliminate mortgage insurance entirely. If rates drop before then, an FHA Streamline Refinance lets you lower your rate with minimal paperwork and no new appraisal.

Ready to Get Pre-Approved for an FHA Loan?

No cost and no commitment to get started. We move at the pace the market demands.