Backed by the Federal Housing Administration, FHA loans open the door for buyers working with a smaller down payment or a credit history that’s still coming together. The qualifying bar is more forgiving than conventional financing — which makes this a strong first step into homeownership.
Why Buyers Choose It
- Flexible credit standards. Lower FICO scores can still qualify.
- Gift funds are welcome. A family member can help with your down payment.
- Easier qualification overall. Requirements tend to be more relaxed than other loan types.
What It Takes To Qualify
- A credit score above 500 with 10% down, or above 580 with 3.5% down
- Funds to cover the 3.5% down payment
- A reasonable debt-to-income ratio
- The home must be your primary residence