FHA loans are insured by the Federal Housing Administration, part of HUD. That insurance lets lenders offer more flexible guidelines, which is why FHA is a go-to option for many first-time buyers and anyone rebuilding credit.
FHA loan highlights
- 3.5% minimum down payment for qualified borrowers
- Flexible credit guidelines, including for buyers with limited credit history
- Higher debt-to-income ratios allowed with strong compensating factors
- Gift funds from family can cover the down payment
- Can be paired with eligible down payment assistance
- Available for 1 to 4 unit primary residences
What to know
Mortgage insurance: FHA has an upfront premium and an annual premium. With a small down payment, the annual premium usually stays for the life of the loan, so many borrowers refinance into conventional later once they've built equity.
Property condition: The FHA appraisal checks that the home meets minimum safety and livability standards. Homes needing major repairs may need them fixed before closing.
Loan limits: FHA sets maximum loan amounts by county. Most homes in Iowa and the Midwest fall well within them.
FHA or conventional?
It depends on your credit, down payment and how long you'll keep the loan. I run both side by side for most buyers. Read FHA vs. conventional for the full comparison.
Getting started
A quick conversation and a look at your credit tells us whether FHA is your best option. No pressure, and no hard credit pull to start. Reach out or apply online.
