Is FHA only for first-time buyers?

No. Anyone who meets the credit and income requirements can use FHA financing, as long as the property is their primary residence. There's no first-time buyer requirement.

How do I get rid of FHA mortgage insurance?

If you put 10% or more down, MIP drops off after 11 years. With less than 10% down, MIP lasts the life of the loan — but most borrowers refinance into a conventional loan once they reach 20% equity to eliminate it.

Can I use an FHA loan to buy a duplex or fourplex?

Yes, as long as you live in one of the units as your primary residence. FHA allows 1–4 unit properties, which is one of the most powerful ways to start building rental income.

What's the difference between FHA MIP and PMI?

MIP is government-backed and required regardless of credit score. PMI on conventional loans is risk-priced — borrowers with strong credit pay much less and can cancel it at 20% equity.

government loan

FHA Loans

FHA loans are insured by the Federal Housing Administration and let you buy with as little as 3.5% down and a 580 credit score, making them a top choice for first-time buyers and credit rebuilders.

Down payment: 3.5% (with 580+ credit) or 10% (with 500–579 credit)
Credit score: 580 (most lenders); 500 with 10% down depending on qualifying factors
Loan amount: $541,287 in most counties; up to $1,249,125 in high-cost areas (2026)
MI: Upfront MIP of 1.75% rolled into loan + annual MIP of 0.55%; lasts the life of the loan if down payment is under 10%

Best for

First-time homebuyers with limited savings
Buyers with credit scores between 580 and 680
Borrowers with higher debt-to-income ratios
Buyers who have had a past bankruptcy or foreclosure (with seasoning)

Eligibility

Credit score of at least 580 for 3.5% down (500–579 requires 10% down)
DTI typically up to 43%, can go higher with compensating factors
Property must be your primary residence
Home must pass an FHA appraisal (stricter than conventional)
Two years post-bankruptcy or three years post-foreclosure

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The upside

Low 3.5% down payment requirement
Flexible credit score requirements
Higher DTI tolerance than conventional loans
Assumable — a future buyer can take over your low rate when you sell
Down payment can be 100% gift funds, if applicable

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Worth considering

Mortgage insurance lasts the life of the loan unless you put 10%+ down
Loan limits are lower than conventional in most counties
Property must meet FHA's minimum property standards
Only allowed for primary residences

Documents you'll need

Two most recent pay stubs
Two years of W-2s and tax returns
Two months of bank statements
Photo ID and Social Security card
Gift letter if any down payment funds are gifted
Bankruptcy or foreclosure discharge papers if applicable

When an FHA loan beats conventional

FHA wins for buyers with credit scores under 700 and small down payments. The flexible underwriting, gift-fund rules, and assumability make it especially valuable for first-time buyers and anyone rebuilding after a credit event.

The trade-off is the lifetime mortgage insurance. Plan to refinance into a conventional loan once you’ve built 20% equity. That captures the early-access benefit of FHA without paying for it forever.

Common questions

Is FHA only for first-time buyers?: No. Anyone who meets the credit and income requirements can use FHA financing, as long as the property is their primary residence. There's no first-time buyer requirement.
How do I get rid of FHA mortgage insurance?: If you put 10% or more down, MIP drops off after 11 years. With less than 10% down, MIP lasts the life of the loan — but most borrowers refinance into a conventional loan once they reach 20% equity to eliminate it.
Can I use an FHA loan to buy a duplex or fourplex?: Yes, as long as you live in one of the units as your primary residence. FHA allows 1–4 unit properties, which is one of the most powerful ways to start building rental income.
What's the difference between FHA MIP and PMI?: MIP is government-backed and required regardless of credit score. PMI on conventional loans is risk-priced — borrowers with strong credit pay much less and can cancel it at 20% equity.