Most Americans need a mortgage to buy a home, but saving enough for a traditional 20% down payment can be an unattainable goal, particularly for first-time homebuyers. Enter the Federal Housing Administration, or FHA, loan program, which guarantees lenders full payment, allowing them to offer borrowers lower down payments and easier credit qualifications than conventional loans. Some FHA mortgage lenders may allow credit scores as low as 500, depending on your down payment.
Homebuyers considering an FHA loan should shop around to find the best mortgage lenders.
This guide explains what you need to know about FHA loans and offers recommendations for the best FHA lenders that can meet your homebuying needs. What you’ll learn:
Flagstar offers banking and lending products in every state. Borrowers can select from conventional or government-backed mortgages, such as FHA, VA and U.S. Department of Agriculture loans, and opt for adjustable-rate mortgages. Other choices include home equity loans and lines of credit.
Before You Apply
Mortgage types: ARMs, conventional, FHA, jumbo, refinance and USDA
Minimum FICO credit score: 600
Maximum loan amount: $3 million
Better Business Bureau rating: A+
Provides a broad selection of mortgages and home equity loans
Offers some mortgages that don’t require a down payment