FHA Loans are insured loans through the Federal Housing Administration. FHA Loans offer a lower qualifying credit score, higher debt-to-income ratios, and a competitive minimum down payment of only 3.5%. FHA loans are an option for first-time homebuyers or those working on rebuilding their credit.
Minimum Credit Score: 580
Minimum Down Payment: 3.5%
Must fall under county FHA loan limit.
Josh has a credit score of 610 and wants to purchase a home. He doesn’t have a lot saved up for a down payment or closing costs. He can get approved for a 3.5% down payment and can always refinance after a year to avoid paying mortgage insurance for the life of the loan! Go, Josh!