The headline requirements are simple: a 580 credit score gets you in with 3.5% down, and a score between 500 and 579 still works if you can put 10% down. The parts that catch people off guard are the mortgage insurance, which usually lasts the life of the loan, and the property standards, which can sink a deal on a fixer-upper.
FHA sets two tiers, and your score decides your minimum down payment rather than a flat yes or no:
One caveat matters here. Those are FHA's floors, not your lender's. Lenders layer their own "overlays" on top, and many won't write FHA loans below 600 or 620 regardless of what HUD allows. If one lender turns you down at 585, another may say yes, so it pays to apply with two or three.
There's no income minimum and no income maximum. FHA cares about whether your income is stable and documented, usually two years of steady employment, not how big it is.
Either 3.5% or 10%, depending on your credit tier. On a $350,000 home, that's $12,250 versus $35,000, which is a big enough gap that borrowers near the 580 line often wait a few months to nudge their score over it.
The down payment doesn't have to be your own savings. Gift funds from family are allowed and common, and many state and local down payment assistance programs pair with FHA loans. What you can't do is borrow the down payment from an unsecured source like a personal loan.
This is the real cost of the easier entry. FHA charges mortgage insurance twice. First, an upfront premium (UFMIP) of 1.75% of the loan, which almost everyone rolls into the balance. On a $337,750 loan that's $5,911 added the day you close. Second, an annual MIP charged monthly. For 2025, on loans up to $726,200:
Notice the pattern: put down less than 10% and the insurance never cancels on its own. A typical 3.5%-down borrower on a $350,000 home pays about $155 a month in MIP, every month, until they sell or refinance into a conventional loan. Price that into your decision, not just the rate.
The calculator applies the 2025 MIP schedule automatically: UFMIP, monthly MIP, taxes, and insurance in one number.
FHA Loan Calculator →The standard cap is a 43% debt-to-income ratio: all your monthly debt payments, including the new mortgage, divided by gross monthly income. Earn $7,000 a month and 43% gives you $3,010 to cover the mortgage, car payments, student loans, and card minimums combined.
FHA is unusually flexible above that line, though. With compensating factors, automated underwriting regularly approves DTIs up to 50% and sometimes higher. Compensating factors include things like:
Before you fall in love with a listing, run your numbers through a DTI calculator so you know which side of 43% you're on, then sanity-check the payment itself with a mortgage calculator.
FHA loans require an FHA appraisal, which is stricter than a conventional one. The appraiser checks value like normal, but also inspects for HUD's minimum property standards: safety, soundness, and security. Common deal-breakers include:
If the appraiser flags issues, the seller can fix them before closing, or the deal can shift to an FHA 203(k) renovation loan, or it falls apart. Homes in rough shape are the main reason FHA offers lose out to conventional ones in competitive markets. The property also has to be your primary residence within 60 days of closing; FHA doesn't finance pure investment properties or flips owned less than 90 days.
FHA is the workhorse program for buyers with thin credit or small savings: 580 score, 3.5% down, DTI to 43% or beyond with compensating factors. Just go in with clear eyes about mortgage insurance. It's the price of admission, it usually lasts as long as the loan does, and it belongs in your monthly budget from day one.
On paper, yes. FHA accepts scores from 500 to 579 with 10% down. In practice it's hard, because most lenders add their own overlays and won't go below 580 or even 620. If you're at 550, spending six months raising your score usually beats hunting for the rare lender who'll take it.
No. Unlike some first-time buyer programs, FHA has no income cap and no first-time buyer requirement. Anyone who meets the credit, down payment, and debt-to-income rules can use one for a primary residence. What FHA does cap is the loan size, which varies by county from $524,225 up to $1,209,750 in 2025.
It depends on your down payment. Put down 10% or more and the annual MIP drops off after 11 years. Put down less, which covers most FHA borrowers, and MIP runs for the life of the loan. The standard exit is refinancing into a conventional loan once you reach about 20% equity.
Not directly. FHA loans are for primary residences you'll occupy within 60 days of closing. The well-known workaround is house hacking: buy a 2-4 unit property with FHA financing, live in one unit for at least a year, and rent out the others. The rental income can even help you qualify.