FHA loan requirements complete guide starts with the answer most buyers need immediately: a 580 credit score can qualify for 3.5% down under FHA baseline rules, while scores from 500 to 579 generally require 10% down. Approval still depends on income, debts, property condition, and the specific FHA program. A clear review before you shop can prevent a disappointing contract surprise.
Duane Buziak, NMLS #1110647
Table of Contents
- FHA eligibility at a glance
- Credit score, income, and property rules
- FHA mortgage insurance costs
- A worked $400,000 purchase example
- Pre-approval without a hard inquiry
- Eight common FHA questions
FHA Loan Requirements Complete Guide: The Core Rules
FHA financing is designed for a primary residence, not a second home or investment property. You need a valid Social Security number, lawful residency status, steady qualifying income, and enough documented funds for the required investment and closing costs. First-time buyers are welcome, but FHA does not require you to be a first-time buyer.
Credit is more flexible than many conventional programs, but it is not ignored. FHA’s baseline score tiers are 580 or higher for 3.5% down and 500 to 579 for 10% down. A score below 500 does not meet the FHA minimum. Individual wholesale programs can add underwriting standards, which is why a broker review matters more than relying on a score alone.
Debt-to-income ratio is equally important. There is no single magic ratio that guarantees approval. Strong compensating factors – such as verified cash reserves, reliable employment history, or a conservative housing payment increase – can support a stronger file. Late payments, collections, disputed accounts, and recent credit events need context, not guesswork.
The home must also qualify. FHA requires an appraisal that establishes market value and identifies safety, security, and soundness concerns. Peeling paint, roof issues, exposed wiring, failed utilities, or missing handrails can delay closing until resolved. For a property needing significant repairs, an FHA 203(k) renovation loan may be a better fit than trying to force a standard FHA appraisal through.
| FHA credit tier | Minimum down payment | Baseline eligibility | Verified as of |
|---|---|---|---|
| 580 and above | 3.5% | Meets FHA minimum score threshold | August 14, 2026 |
| 500 to 579 | 10% | Meets FHA minimum with higher investment | August 14, 2026 |
| Below 500 | Not eligible | Below FHA minimum score threshold | August 14, 2026 |
| No traditional score | Case-specific | May require alternative credit documentation | August 14, 2026 |
County loan limits also matter. FHA limits change annually and vary by county, so do not rely on an old national figure from a search result. Before making an offer, confirm the limit for the property’s county and the number of units. Virginia buyers should verify the applicable county limit early, particularly in higher-cost areas near the Richmond metro and Northern Virginia.
FHA Mortgage Insurance: Know the Cost Before You Offer
FHA charges two mortgage insurance premiums. The upfront mortgage insurance premium, or UFMIP, is generally 1.75% of the base loan amount and is commonly financed into the loan. Annual mortgage insurance is paid monthly. On most 30-year FHA loans above 90% loan-to-value, the annual charge is 0.55% of the base loan amount and usually lasts for the life of the loan.
| Loan term | Base LTV | Annual MIP rate | MIP duration |
|---|---|---|---|
| Over 15 years | Over 90% | 0.55% | Loan term |
| Over 15 years | 90% or less | 0.50% | 11 years |
| 15 years or less | Over 90% | 0.40% | Loan term |
| 15 years or less | 90% or less | 0.15% | 11 years |
MIP structure verified as of August 14, 2026. This is the trade-off for FHA’s lower down payment and more forgiving credit entry point. Later, if equity and credit support it, refinancing into a conventional loan may remove monthly mortgage insurance. That decision depends on rates, closing costs, home value, and how long you expect to keep the property.
Worked example: $400,000 FHA purchase
Assume a $400,000 purchase price, 3.5% down, a 30-year fixed FHA loan, and a 6.50% interest rate. The down payment is $400,000 × 3.5% = $14,000. The base loan amount is $400,000 – $14,000 = $386,000.
UFMIP is $386,000 × 1.75% = $6,755. If financed, the starting loan balance becomes $392,755. At 0.55%, first-year annual MIP is $386,000 × 0.55% = $2,123, or about $176.92 per month. Principal and interest on $392,755 at 6.50% for 30 years is approximately $2,482.50 per month. Before taxes and homeowners insurance, the estimated payment is $2,659.42 per month.
That is real planning math, not a payment teaser. Property taxes, insurance, homeowner association dues, and any seller-paid costs can materially change the final number.
Start With a NoTouch Credit Pull
A rushed pre-approval can cost you points before you have chosen a home. The NoTouch Credit Pull process gives buyers an initial direction without a hard credit inquiry. It is a soft pull credit check built to review score range, liabilities, and likely FHA options before a full application is submitted.
Ask for a soft credit pull when you want to compare scenarios without immediately triggering a hard inquiry. A soft pull pre-approval can help you understand purchasing power, while a no hard credit check discussion can identify documents and credit items that need attention. NoTouch Credit Pull is not a final approval and does not replace full underwriting, but it creates a smarter starting point.
As an independent broker, I can review FHA pathways across 500+ wholesale lender options rather than being limited to one retail bank product shelf. That can matter when your file includes variable income, a recent credit event, gift funds, down payment assistance, or a property needing 203(k) financing. The goal is not to promise an approval. It is to identify the cleanest path to one.
FHA Loan Requirements FAQs
Can I get an FHA loan with a 580 credit score?
Yes. A 580 score meets FHA’s baseline requirement for a 3.5% down payment. Your income, debts, payment history, and property must still meet program and underwriting requirements. Some wholesale programs may impose additional standards, so a full file review is more useful than relying on score alone.
Is the FHA down payment always 3.5%?
No. Buyers with a 580 score or higher may qualify with 3.5% down under FHA baseline rules. Scores from 500 through 579 generally require 10% down. Gift funds and eligible down payment assistance may help satisfy the required investment, subject to documentation and program rules.
Can FHA closing costs be paid by the seller?
A seller may contribute toward allowable buyer closing costs within FHA limits. The exact structure depends on the contract, appraisal, and transaction details. This can reduce cash needed at closing, but it does not change the required down payment or eliminate the need for a properly qualified loan file.
Does FHA mortgage insurance ever go away?
It depends on the original loan-to-value and term. On a typical 30-year FHA loan with more than 90% financing, annual mortgage insurance generally lasts for the loan term. Refinancing to conventional financing later may remove it if equity, credit, income, and market terms support the move.
Can I use FHA if I owned a home before?
Yes. FHA is not limited to first-time buyers. You generally must purchase a primary residence and meet occupancy requirements. Existing FHA financing, recent relocations, family changes, and other ownership situations can affect eligibility, so the facts should be reviewed before you start making offers.
Are FHA loan limits the same everywhere?
No. Limits are set by county and can differ significantly between markets. The limit also changes based on the number of units in the property. Confirm the current county limit before writing an offer, especially when purchasing near the top of your budget or considering a duplex.
Can an FHA loan pay for repairs?
A standard FHA purchase loan is not built to finance major renovations. An FHA 203(k) loan can combine the purchase or refinance with eligible repair funds. It adds process requirements, contractor documentation, and timeline considerations, but can be practical when the right home needs work.
Will NoTouch Credit Pull hurt my score?
NoTouch Credit Pull uses a soft inquiry for the initial review, so it does not create a hard inquiry on your credit report. A complete mortgage application later may require a hard inquiry. Starting with a no hard credit inquiry lets you assess options before taking that next step.
Before You Apply
Bring recent pay documentation, two years of income records when applicable, asset statements, identification, and details about any credit event. If you are using gift funds or down payment assistance, address that early. A clean paper trail is often more valuable than a last-minute scramble for a slightly higher score.
Legal disclaimer: This article is educational information, not a loan approval, credit decision, legal advice, or commitment to extend credit. FHA program terms, mortgage insurance, county limits, rates, underwriting standards, and eligibility can change. All loans are subject to application, verification, appraisal, underwriting, and program availability. Coast2Coast Mortgage LLC originates only where licensed: VA, FL, TN, GA, and DC.
The best next move is simple: establish your real FHA buying range before you fall in love with a home that does not fit it.
Duane Buziak, Mortgage Maestro Coast2Coast Mortgage LLC NMLS #1110647 (804) 212-8663 duane@coast2coastml.com 4860 Cox Rd, Glen Allen VA 23060 Licensed: VA, FL, TN, GA, DC VA Broker of the Year 2024-2025 Scotsman Guide Top Originator 2025 & 2026 UWM PRO ELITE 2025 Top 1% Nationwide 1,400+ five-star reviews.
