Who it is for
- Buyers with credit in the 580–660 range
- Anyone with 3.5–10% down and limited reserves
- Borrowers 2+ years past a bankruptcy or 3+ years past a foreclosure
- First-time buyers pairing FHA with down payment assistance
Typical FHA Loan Requirements requirements
| Minimum credit score | 580 for 3.5% down; 500–579 allowed with 10% down (few lenders go below 580) |
|---|---|
| Down payment | 3.5% minimum at 580+; must come from savings, gift, or approved assistance |
| Max DTI | Typically 46.99% housing / 56.9% total with automated approval; manual underwrites lower |
| Mortgage insurance | 1.75% upfront MIP (usually financed) plus annual MIP, roughly 0.55% for most buyers |
| Occupancy | Primary residence only; you must move in within 60 days |
| Waiting periods | Chapter 7 bankruptcy: 2 years; foreclosure or short sale: 3 years |
| Income documentation | 2 years of W-2s/tax returns or equivalent; self-employed averaged over 2 years |
| Property standards | Must meet HUD minimum property requirements at appraisal |
Figures are typical market ranges as of October 2026. Actual terms depend on the lender, your credit, the property and the program, and are confirmed on your Loan Estimate or term sheet.
How it works
- Check your middle credit score across the three bureaus; 580 is the line that unlocks 3.5% down.
- Add up every monthly debt plus the proposed housing payment; stay near or under the 57% total-debt guideline.
- Source your down payment: bank it for 60 days, or line up a gift letter or an approved assistance program.
- Verify the property can pass an FHA appraisal: working utilities, sound roof, no peeling paint on pre-1978 homes, safe access.
- Get pre-approved with documents in hand; FHA files move fast when income and assets are already verified.
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Pros and cons
Advantages
- Lowest down payment among mainstream programs at 580 credit
- Higher DTI tolerance than conventional
- Shorter waiting periods after credit events
- Gift funds and assistance programs widely accepted
Trade-offs
- MIP lasts the life of the loan at most down payments
- Primary residence only, no investment properties
- HUD appraisal standards can kill fixer deals
- Loan limits cap the purchase price by county
Documents you’ll need
- Photo ID and Social Security number
- 2 years of W-2s and federal tax returns (all schedules)
- 30 days of pay stubs
- 2–3 months of bank statements for every account
- Gift letter and donor bank statement if using gift funds
- Divorce decree or child support orders if applicable
FHA Loan Requirements FAQ
What credit score do I need for an FHA loan?
HUD allows 580 with 3.5% down and 500–579 with 10% down. In practice, most lenders set their own floor at 580, and pricing improves noticeably around 620–640.
How much can my debts be for an FHA loan?
Automated approvals commonly go to 46.99% of income on housing and 56.9% on all debts. Manual underwrites, which some lenders require below 620, are tighter.
Does FHA mortgage insurance ever go away?
Annual MIP lasts for the life of the loan when you put less than 10% down. With 10% or more down, it drops off after 11 years. Many borrowers refinance into conventional once they reach 20% equity.
Can I use an FHA loan on a fixer-upper?
A standard FHA appraisal requires the home to be safe, sound and secure as-is. For homes needing real work, the FHA 203(k) renovation loan bundles purchase and repairs in one FHA mortgage.
How long after bankruptcy can I get an FHA loan?
Two years after a Chapter 7 discharge and one year into a Chapter 13 with trustee approval and on-time payments. Foreclosures and short sales need three years.
Can a non-occupant co-borrower help me qualify?
Yes. FHA allows a non-occupant co-borrower, often a parent, to co-sign and add their income to the qualification, which is a common path for first-time buyers.
Can I get an FHA loan with no credit history?
It is possible but difficult. Some lenders will build a non-traditional credit file from rent, utility and insurance payment history, but most want to see at least some tradelines. Expect a manual underwrite and a longer process.
Does the FHA loan limit affect me?
FHA caps the loan amount by county, and the limits change yearly. In most counties the 2026 floor sits around the mid-$400Ks, while high-cost areas go much higher. Check your county’s limit before house hunting so you do not fall for a home you cannot finance.
Can I rent out my home later if I bought with FHA?
Yes, after you have lived there at least a year to satisfy the occupancy requirement. Many borrowers buy with FHA, live in the home for a year or more, then convert it to a rental and buy their next home. Just do not buy with FHA planning to rent it out from day one.
How FHA Loan Requirements compare
| FHA Loan Requirements | FHA Loans | FHA 203(k) Renovation Loans | First-Time Homebuyer Loans | |
|---|---|---|---|---|
| Best for | Buyers with credit in the 580–660 range | First-time buyers | Buyers of fixer-uppers who will live in the home | Renters ready to buy |
| Down payment | 3.5% minimum at 580+; must come from savings, gift, or approved assistance | , | 3.5% of purchase price plus repair costs | 0% VA, 3% conventional, 3.5% FHA |
| Credit | 580 for 3.5% down; 500–579 allowed with 10% down (few lenders go below 580) | 580 for 3.5% down; 500–579 with 10% down | 580 under FHA rules; lenders often want 620+ | , |
| Income docs | 2 years of W-2s/tax returns or equivalent; self-employed averaged over 2 years | , | , | , |
Typical ranges, your Loan Estimate or term sheet confirms actual terms.
Coming soon: a 2-minute walkthrough from our loan team.
Related programs
FHA Loans
An FHA loan is a government-insured mortgage that allows 3.5% down with a credit score of 580 or higher, or 10% down with a score from 500 to 579.
FHA 203(k) Renovation Loans
An FHA 203(k) loan finances both the purchase (or refinance) of a home and the cost of repairing it in a single FHA-insured mortgage, with as little as 3.5% down.
First-Time Homebuyer Loans
First-time homebuyer loans are mortgage options with low down payments, typically 3% conventional, 3.5% FHA or $0 VA, often paired with state or local down payment assistance.