What Is an FHA Loan?
An FHA loan is a mortgage insured by the Federal Housing Administration — a government agency within the U.S. Department of Housing and Urban Development (HUD). Created in 1934 during the Great Depression to stimulate the housing market and make homeownership more accessible, FHA loans remain one of the most popular mortgage programs in the United States today.
The key difference: because the FHA insures the loan (meaning they guarantee repayment to the lender if you default), lenders are willing to offer more flexible qualifying requirements — including lower credit scores, smaller down payments, and higher debt-to-income ratios than most conventional loans allow.
FHA loans are available through approved private lenders like banks, credit unions, and mortgage brokers — but the loan itself is backed by the federal government. This makes them far less risky for lenders, which translates into better terms for borrowers who might not qualify for conventional financing.
The FHA Loan Process: What to Expect
- Pre-Qualification (Day 1)
We review your income, credit, and assets. I identify the best FHA program for your situation. - Pre-Approval Letter (24–48 Hours)
Submit documents, lender reviews file, issues pre-approval. You're ready to shop for homes. - Purchase Contract (Varies)
You find a home and your offer is accepted. We formally submit the loan application. - Loan Processing (24–48 Hours)
Processor compiles your file. FHA appraisal is ordered. Title work begins. - Underwriting (3–7 Business Days)
Underwriter reviews full file. May issue conditions (additional documents requested). - Clear to Close & Closing (1–3 Days)
All conditions satisfied. Closing date is scheduled. You sign documents and get your keys!
Total timeline: typically 30–45 days from contract to closing when all documents are submitted promptly.
FHA Loan Requirements — 2026
Here are the key requirements to qualify for an FHA loan this year:
Credit Score Requirements
| Credit Score | Minimum Down Payment | Notes |
|---|---|---|
| 580 and above | 3.5% | Standard FHA program — most common |
| 500–579 | 10% | Higher down payment required |
Additional Qualifying Requirements
- Employment: At least 2 years of steady employment history (or consistent self-employment)
- Income: Verifiable income sufficient to support the mortgage payment
- Primary Residence: FHA loans are for primary residences only — not investment properties
- FHA Appraisal: The property must meet HUD minimum property standards
- Citizenship: U.S. citizens, permanent residents, and eligible non-citizens qualify
2026 FHA Loan Limits — Florida & Texas
FHA loan limits are set annually by HUD and vary by county. Select your state and county below to see the 2026 limits.
Limits set by HUD for 2026. If your county is not listed or you need to verify current limits, contact us directly.
If the home price exceeds the FHA limit for your county, you may need to consider a conventional loan, a jumbo loan, or a combination approach. I can help you explore all options.
FHA Loan Costs: What to Expect
Mortgage Insurance Premiums (MIP)
FHA loans require two types of mortgage insurance: an upfront premium (UFMIP) and an annual premium (MIP).
- Upfront MIP: 1.75% of the loan amount — typically rolled into the loan
- Annual MIP: 0.55% to 0.70% annually (paid monthly), depending on loan term and LTV
Note: MIP rates listed above reflect current HUD guidelines as of March 2026 and are subject to change by HUD at any time without notice. Verify current MIP rates with your loan officer prior to application.
Unlike conventional PMI, FHA MIP is required for the life of the loan if your down payment is less than 10%. If you put 10% or more down, MIP can be removed after 11 years. This is one reason some buyers eventually refinance to a conventional loan once they build 20% equity.
Closing Costs
FHA closing costs typically range from 2–5% of the loan amount and include origination fees, title insurance, appraisal, and prepaid items. One major advantage: sellers can contribute up to 6% of the purchase price toward your closing costs — which can dramatically reduce your out-of-pocket expenses at closing.
FHA Loans for Self-Employed Borrowers
Self-employed individuals can qualify for FHA loans, but the documentation requirements are more involved. Lenders will typically require:
- 2 years of federal tax returns (personal and business)
- Current year profit & loss statement
- Business bank statements (12–24 months)
- CPA letter verifying business and ownership percentage
The challenge for self-employed borrowers: aggressive write-offs reduce your taxable income, which can hurt your ability to qualify for the loan amount you need. If your tax returns show significantly less income than you actually earn, a bank statement loan or NON-QM program may be a better fit.
FHA Loans with Credit Challenges
After Bankruptcy
- Chapter 7: Must wait 2 years from discharge date + re-established credit
- Chapter 13: May qualify after 1 year of on-time payments with court permission
After Foreclosure
- Must wait 3 years from the foreclosure completion date
- Exceptions possible for documented extenuating circumstances
Late Payments & Collections
FHA is more forgiving than conventional loans regarding isolated late payments and older collection accounts. Recent 30-, 60-, or 90-day lates will require explanation and may require waiting periods. Medical collections are generally excluded from FHA qualifying.
Why Work With a Mortgage Broker for Your FHA Loan?
- Access to 25+ Wholesale Lenders: I shop your loan to multiple FHA-approved lenders to find you the best rate and lowest fees
- FHA Expertise: I know which lenders are most FHA-friendly and can move quickly
- Local Florida Knowledge: I understand the Tampa Bay market, local closing attorneys, and Florida-specific DPA programs
- Personal Service: You work directly with me, not a call center or a different processor every week
- No Bank Restrictions: I can solve problems that bank loan officers can't because I have options