More Buyers Qualify. Same Great Rates.
FHA loans open the door to homeownership with flexible credit guidelines, low down payments, and government-backed security — ideal for first-time buyers.
3.5%
Min. Down Payment
580
Min. Credit Score
Up to $1,209,750
Loan Limits (OR/CA)
Annual MIP Required
Mortgage Insurance
What is an FHA loan?
An FHA loan is a government-insured mortgage backed by the Federal Housing Administration, designed for buyers who may not qualify for conventional financing. FHA loans require just 3.5% down with a 580 credit score, making them one of the most accessible home loan options available — especially for first-time buyers.
Best for: First-time homebuyers, buyers with lower credit scores, and borrowers who need a low down payment option.
3.5%
Min. Down Payment
580
Min. Credit Score
1.75%
Upfront MIP
0.55%
Annual MIP
57%
Max DTI
Overview
The Most Accessible Path to Homeownership
FHA loans are insured by the Federal Housing Administration, which allows lenders to offer more flexible qualification criteria than conventional loans. The government guarantee reduces lender risk — and that savings is passed on to borrowers in the form of lower credit requirements and smaller down payments.
FHA is consistently the #1 loan choice for first-time homebuyers, and it's a powerful option for anyone rebuilding credit or working with limited savings. Gift funds, down payment assistance programs, and seller concessions are all allowed — making FHA one of the most accessible paths to homeownership available today.
Who This Is For
Key Features
What Makes This Program Work
3.5% Down
One of the lowest down payment requirements available — and the whole amount can come from gift funds or down payment assistance.
Flexible Credit
Scores as low as 580 qualify for 3.5% down. Even scores between 500–579 can qualify with a 10% down payment.
Gift Funds Allowed
100% of your down payment and closing costs can come from a documented gift from a family member or eligible organization.
Streamline Refinance
Already have an FHA loan? The FHA Streamline Refi lets you lower your rate with minimal paperwork and no new appraisal required.
Assumable Loan
FHA loans are assumable — a future buyer can take over your loan at your existing rate, making your home more attractive to sell.
Higher DTI Tolerance
FHA allows debt-to-income ratios up to 57% in some cases, giving more borrowers a path to approval.
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FHA Loan & MIP Calculator
See exactly how upfront MIP is financed into your loan, how your down payment affects the annual MIP rate, and when (or if) MIP cancels — for any purchase price.
FHA Loan & MIP Calculator
Upfront & annual MIP · financed into loan · 2025 rates
≥ 10% down → MIP cancels after 11 years · < 10% down → MIP for life of loan
How FHA MIP Works
Total Monthly Payment
$2,932/mo
P&I Payment
$2,710.71
Monthly MIP
$221.15
Loan Breakdown
Purchase Price
$500,000
Down Payment
$17,500 (3.5%)
Base Loan Amount
$482,500
Upfront MIP (1.75%)
Financed into loan
+ $8,444
Total Financed Loan
$490,944
MIP Lasts the Life of the Loan
At 3.5% down (LTV 96.5%), FHA requires MIP for the full 30-year term. Estimated total MIP cost: $88,056.
| Year | Principal | Interest | MIP | Balance |
|---|---|---|---|---|
| 1 | $6,924 | $25,605 | $2,654 | $484,020 |
| 2 | $7,296 | $25,232 | $2,654 | $476,724 |
| 3 | $7,688 | $24,840 | $2,654 | $469,035 |
| 4 | $8,102 | $24,427 | $2,654 | $460,933 |
| 5 | $8,538 | $23,991 | $2,654 | $452,396 |
| 6 | $8,997 | $23,532 | $2,654 | $443,399 |
| 7 | $9,480 | $23,048 | $2,654 | $433,919 |
| 8 | $9,990 | $22,538 | $2,654 | $423,929 |
| 9 | $10,527 | $22,001 | $2,654 | $413,402 |
| 10 | $11,093 | $21,435 | $2,654 | $402,308 |
| 11 | $11,690 | $20,839 | $2,654 | $390,618 |
| 12 | $12,318 | $20,210 | $2,654 | $378,300 |
| 13 | $12,981 | $19,548 | $2,654 | $365,319 |
| 14 | $13,679 | $18,850 | $2,654 | $351,640 |
| 15 | $14,414 | $18,114 | $2,654 | $337,226 |
| 16 | $15,189 | $17,339 | $2,654 | $322,036 |
| 17 | $16,006 | $16,522 | $2,654 | $306,030 |
| 18 | $16,867 | $15,662 | $2,654 | $289,163 |
| 19 | $17,774 | $14,755 | $2,654 | $271,389 |
| 20 | $18,730 | $13,799 | $2,654 | $252,660 |
| 21 | $19,737 | $12,792 | $2,654 | $232,923 |
| 22 | $20,798 | $11,731 | $2,654 | $212,125 |
| 23 | $21,916 | $10,612 | $2,654 | $190,209 |
| 24 | $23,095 | $9,434 | $2,654 | $167,114 |
| 25 | $24,337 | $8,192 | $2,654 | $142,777 |
| 26 | $25,645 | $6,883 | $2,654 | $117,132 |
| 27 | $27,024 | $5,504 | $2,654 | $90,108 |
| 28 | $28,477 | $4,051 | $2,654 | $61,631 |
| 29 | $30,009 | $2,520 | $2,654 | $31,622 |
| 30 | $31,622 | $906 | $2,654 | Paid off |
| Total | $490,944 | $484,910 | $79,613 | paid off |
FHA MIP rates reflect current HUD guidelines as of 2025. UFMIP = 1.75% of the base loan amount, typically financed. Annual MIP rates and duration depend on loan amount, original LTV, and loan term. All results are estimates only and do not constitute a loan commitment. Lumen Mortgage Corporation · NMLS #1498678 · Licensed in Oregon & California.
Requirements
General Qualifications
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Licensed in Oregon & California · NMLS #1498678
FAQ
Common Questions
Side-by-Side Comparison
How Does FHA Compare?
Compare key requirements, costs, and features at a glance — so you can choose the right loan for your situation.
FHA vs. Conventional — Side by Side
Which loan saves you more over the life of the mortgage?
| FHA | Conventional | |
|---|---|---|
| Min. Down Payment | 3.5% (580+ score) | 3% (620+ score) |
| Min. Credit Score | 580 (500 with 10% down) | 620 |
| Upfront Insurance | 1.75% UFMIP (financed) | None |
| Annual Insurance | 0.55% MIP — life of loan | 0.3–1.5% PMI — cancels at 20% equity |
| Max DTI | Up to 57% | 43–50% |
| Seller Concessions | Up to 6% | 3–9% (depends on LTV) |
| Multi-Unit Eligible | Yes — 1–4 unit (owner-occupied) | Yes — 1–4 unit + investment |
| Best For | Lower credit, limited savings | 680+ credit, want PMI to cancel |
From the Blog
Further Reading
Loan TypesFHA vs. Conventional Loans: Which Is Right for You?
These two loan types cover the majority of home purchases in the U.S. — but they work very differently. Here's a side-by-side breakdown to help you make the right call.
First-Time BuyersWhat Credit Score Do You Need to Buy a Home in 2026?
Your credit score is one of the first things lenders look at — but the minimum varies by loan type. Here's a clear breakdown of what's required and how to improve your score before you apply.
OregonOregon First-Time Homebuyer Programs You May Not Know About
Oregon has several programs specifically designed to help first-time buyers get into a home with less money down and better rates. Here's what's available and how to qualify.
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