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FHA Mortgage Loans

FHA mortgage loans are federal assistance mortgage loans in the United States insured by the Federal Housing Administration. The loans may be issued by federally qualified lenders. We work with some lenders who are willing and able to finance FHA mortgage loans well below the normal credit score requirements. For example, a borrower can get a bad credit FHA mortgage loan with a 500 credit score and a 15% down payment. There are other bad credit FHA mortgage loan options that require a smaller down payment with a slightly higher score.

FHA mortgage loans have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford. Recent changes to the guidelines indicate that a larger down payment may be needed in the future. Complete the FREE RATE QUOTE form and we will help you figure out whether you qualify with no obligation at all.

FHA mortgage loans will be underwritten to ensure the borrowers have the ability to repay the loan, will require escrow for taxes and insurance, and will continue to offer unprecedented foreclosure prevention assistance. The FHA has never permitted and will not include pre payment penalties or teaser rates that are common in exotic mortgages and have caused much of the current market troubles. If your down payment is less than 20% of the purchase, you will be required to have MIP (Mortgage Insurance Premium) which is a percentage of the loan and can be financed. Come back for the latest FHA news to be sure that this premium can still be financed. See more below on MIP

See below to find more FHA mortgage lenders


 To qualify for FHA mortgage loans, eligible homeowners must meet the following five criteria: 

  • A history of on time mortgage payments;
  • Three percent cash or equity in the home;
  • A sustained history of employment; and
  • Sufficient income to make the mortgage payment.

FHA does not make loans. Rather, it insures loans made by private lenders. The first step in obtaining an FHA mortgage loan is to complete a confidential free FHA rate quote to see if you qualify.

Second, the lender assesses the prospective home buyer for risk. The analysis of ones debt to income ratio enables the buyer to know what type of home can be afforded based on monthly income and expenses and is one risk metric considered by the lender. Other factors, e.g. payment history on other debts, are considered and used to make decisions regarding eligibility and terms for a loan.

FHA DOWN PAYMENT information

The FHA mortgage insurance programs (MIP) help low and moderate income families become homeowners by lowering some of the costs of their mortgage loans. FHA mortgage insurance also encourages lenders to make loans to otherwise credit worthy borrowers and projects that might not be able to meet conventional underwriting requirements, protecting the lender against loan default on mortgages for properties that meet certain minimum requirements.....including manufactured homes, single and multifamily properties, and some health related facilities. The basic FHA mortgage insurance program is Mortgage Insurance for One to Four Family Homes.


 To see what the FHA mortgage loan limits are in your area, click on the FHA Loan Limit Calculator below.

FHA Loan Limit Calculator






Related Links

Rising FHA Default Rates - Washington Post

FHA Raises Fees and Tightens Loan Standards - MSNBC

Things To Know About An FHA Loan - Bankrate



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 Dream Home Financing is a marketing company that provides mortgage related information. Dream Home Financing does not arrange for or originate loans. The request quote and quick application pages, when completed will be sent to third party lenders for consideration.