FHA
Home Loans
Low Down Payment. Flexible Credit. A Real Path to Homeownership.
FHA loans are one of the most accessible mortgage options available - and at Direct Rate, we help first-time buyers and credit-rebuilding borrowers across Texas, Florida, California, Colorado, New Mexico, Montana, and Arizona get approved with confidence. If you have been told no before, we will show you what is actually possible.
What Is an FHA Home Loan?
An FHA loan is a mortgage insured by the Federal Housing Administration. Because the government backs the loan, lenders can offer more flexible credit and down payment requirements - making homeownership accessible to buyers who may not qualify for a conventional loan.
- Primary residences only
- First-time and repeat buyers both qualify
- Available as a purchase loan or refinance
- Works alongside down payment assistance programs
Think you might not qualify? Talk to us before you assume.
Talk to an Advisor →Why Borrowers Choose FHA
Benefits
- Down payment as low as 3.5% with a 580+ credit score
- Credit scores as low as 500 considered (with 10% down)
- 100% of down payment can come from gift funds
- Seller can contribute up to 4% toward closing costs
- More flexible debt-to-income ratio than conventional
- Great stepping stone to build equity and refinance later
Things to Know
- Mortgage insurance is required for the life of most FHA loans
- Property must meet FHA minimum condition standards
- Primary residence only - no investment properties
- Loan limits vary by county and are set annually
Want to compare FHA vs conventional side by side?
Compare My Options →Do You Qualify for an FHA Loan?
Here is what lenders typically evaluate for FHA approval:
- Credit score: 580+ for 3.5% down / 500-579 with 10% down
- Down payment: 3.5% minimum (can be gifted from family)
- Income: Steady income and verifiable employment history
- Debt-to-income ratio: typically 43-50% depending on profile
- Usage: Primary residence only
- Property: meets FHA appraisal and condition standards
Every borrower is different. Even if you have had a past bankruptcy or foreclosure, you may still qualify. Let us review your full picture.
Not sure where you stand? Check your eligibility in minutes.
Check My Eligibility →How the FHA Loan Process Works
We review your goals, credit, and budget.
Documents verified and pre-approval issued in 24hrs.
Full file review, FHA appraisal ordered.
Final approval confirmed, closing scheduled.
Loan funds. Keys in hand. You are a homeowner.
Ready to get started? Pre-approval takes less than 24 hours.
Start My Pre-Approval →Is an FHA Loan Right for You?
Great fit if you...
- Are buying your first home
- Have a credit score between 580 and 680
- Have limited savings for a down payment
- Want to use gift funds from family
- Have had past credit challenges
- Want a loan that works with assistance programs
Consider another program if you...
- Have a 680+ score and 5%+ down - conventional may cost less
- Are an eligible veteran - a VA loan offers 0% down and no PMI
- Are buying in an eligible rural area - USDA offers 0% down
- Want to buy a second home or investment property
Not sure which program is best for you? We will run the numbers.
Compare Programs →FHA Home Loans by State
Direct Rate is licensed to offer FHA home loans across 7 states. Find your state below for local guidance, FHA loan limits, and a licensed advisor who knows your market.
San Antonio, Houston, Dallas, Austin
FHA Loans in Texas >>Los Angeles, San Diego, Sacramento
FHA Loans in California >>Miami, Orlando, Tampa, Jacksonville
FHA Loans in Florida >>Denver, Colorado Springs, Boulder
FHA Loans in Colorado >>Albuquerque, Santa Fe, Las Cruces
FHA Loans in New Mexico >>Billings, Missoula, Bozeman
FHA Loans in Montana >>Phoenix, Tucson, Scottsdale, Mesa
FHA Loans in Arizona >>Not in one of these states? Contact us and we will let you know how we can help.
Common Questions About FHA Loans
580 is the standard minimum for a 3.5% down payment. Borrowers with scores between 500 and 579 may still qualify with a 10% down payment. If your score is below 580, we can also help you build a plan to get there.
Yes. 100% of your FHA down payment can come from a documented gift from a family member, employer, or approved organization. This makes FHA one of the most accessible options for buyers without large savings.
Yes. FHA loans require both an upfront mortgage insurance premium (typically 1.75% of the loan amount, which can be financed) and an annual premium paid monthly. On most FHA loans, the monthly premium lasts for the life of the loan unless you refinance into a conventional loan once you build equity.
Absolutely. Many FHA borrowers refinance into a conventional loan once they reach 20% equity to eliminate mortgage insurance and reduce their monthly payment. Our team will tell you exactly when that makes sense for your situation.
No. Anyone who meets the qualification requirements can use an FHA loan for a primary residence - whether it is your first home or not. First-time buyers do get access to some additional assistance programs, but FHA itself is open to all qualifying borrowers.
FHA loan limits vary by county and are updated annually by HUD. In most areas the 2025 limit for a single-family home is $498,257, with higher limits in high-cost markets. Your advisor will confirm the exact limit for your area.
Yes. FHA allows sellers to contribute up to 6% of the purchase price toward the buyer's closing costs. This is one of the most useful tools for buyers trying to minimize out-of-pocket expenses at closing.
For Chapter 7 bankruptcy, most borrowers can qualify 2 years after discharge with re-established credit. For foreclosure, the standard waiting period is 3 years. Exceptions exist for extenuating circumstances - our advisors can review your specific timeline.
Still have questions? A licensed advisor is ready to help.
Speak With an Advisor →Explore Other Loan Options
Ready to Find Out If You Qualify?
No pressure. No commitment. Just a clear, honest conversation about your options.