An FHA mortgage is a government-insured loan backed by the Federal Housing Administration (FHA). These loans are designed to make homeownership more accessible and affordable. FHA loans typically have more flexible underwriting guidelines.

✅ higher debt-to-income ratios allowed 57%
✅ minimum credit requirement of 500
✅ low down payments starting at 3.5%

✅ can be easily refinanced with a “streamline”

✅ Up to 6% seller concessions allowed to cover closing costs
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❌ FHA interest rates can be higher at higher credit scores ~700 FICO
❌ FHA monthly mortgage insurance cannot be deleted with less than 10% down
❌ FHA charges 1.75% of up-front mortgage insurance premium (UFMIP)

❌ FHA loans have 35% lower size limits compared to conventional loans ($472.030 for a single unit vs. $726,200)
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Here are the FHA loan limits for 2023

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