FHA
More forgiving on credit, with a trade-off worth understanding.
Drake explains this one himself
Every program on this site gets a short video from Drake — the same explanation he would give you on a call, so you can hear it before you ever have to make one.
This one has not been recorded yet. Until it is, the writing below covers the same ground.
What it is
An FHA loan is insured by the Federal Housing Administration. That insurance is what lets lenders be more flexible about credit history and down payment than they otherwise would be.
It is often the right answer for a buyer whose credit is still recovering, or who has less saved. It is not automatically the cheaper answer, which is the part that gets skipped.
Who it may suit
- Buyers whose credit is still being rebuilt
- Buyers with a smaller amount saved for a down payment
- Buyers who have had a past credit event and have been told to wait
Worth knowing
- FHA loans carry mortgage insurance in two parts: an upfront premium and an annual premium. On most FHA loans today, the annual premium stays for the life of the loan.
- Because that insurance does not fall off, refinancing later is often how people leave it behind.
- The property itself has to meet FHA condition standards, which matters on older homes.
General information only. Program guidelines change, and what you qualify for depends on a full review of your situation. Nothing on this page is a commitment to lend or an offer of credit.
Not sure whether FHA is the one?
That is the normal position to be in. Six short questions and I will tell you which programs are actually worth comparing for your situation.