Mortgage Glossary
FHA (Federal Housing Administration)
A government agency whose insured loans help buyers with lower credit or down payments.
The Federal Housing Administration (FHA) is a U.S. government agency that insures mortgages made by approved lenders.
FHA loans are popular with first-time buyers because they allow down payments as low as 3.5% and more flexible credit requirements.
FHA loans require both an upfront and annual mortgage insurance premium, which protects the lender against default.
Frequently asked
What credit score do FHA loans require?
Many FHA programs accept scores of 580 or higher with 3.5% down; some allow lower scores with a larger down payment.
Can FHA loans be used by repeat buyers?
Yes — FHA loans are available to both first-time and repeat buyers for primary residences.
Related terms
PMI (Private Mortgage Insurance)
Insurance that protects the lender when a conventional borrower puts down less than 20%.
Mortgage Insurance
Insurance that protects the lender if a borrower defaults on a low-down-payment loan.
DTI (Debt-to-Income Ratio)
The percentage of your gross monthly income that goes toward debt payments.