What Is an FHA Loan?
An FHA loan is a mortgage insured by the Federal Housing Administration, designed to make homeownership accessible to borrowers who may not qualify for conventional financing. FHA loans are not issued by the government — they're originated by approved lenders like Custom Mortgage Inc.
Key Benefits
- 3.5% minimum down payment (with 580+ FICO score)
- Down to 500 FICO with 10% down
- Lower closing costs than conventional loans
- Gift funds accepted for the entire down payment
- Assumable — a major advantage in high-rate environments
2026 FHA Loan Limits
FHA loan limits vary by county based on local home prices:
| Market Type | 1-Unit Limit | Example Counties | |-------------|-------------|------------------| | Floor (low-cost) | $498,257 | Most rural counties | | Ceiling (high-cost) | $1,149,825 | LA, SF, NYC, DC | | Standard | $498,257-$1,149,825 | Most metro areas |
Who Should Consider FHA?
- First-time buyers with limited savings
- Borrowers rebuilding credit (580-640 FICO range)
- Buyers using gift funds for down payment
- Borrowers with higher DTI (FHA allows up to 50% with compensating factors)
FHA vs. Conventional: Quick Comparison
| Factor | FHA | Conventional | |--------|-----|-------------| | Min. down payment | 3.5% | 3-5% | | Min. FICO | 500 (10% down) / 580 (3.5% down) | 620-680 | | Mortgage insurance | Required (life of loan w/ <10% down) | Removable at 80% LTV | | Max DTI | 43-50% | 43-50% | | Loan limits | County-specific | Higher for jumbo |
How to Get Started
Getting pre-approved for an FHA loan takes 15-30 minutes. You'll need:
- 2 years of W-2s or tax returns
- Recent pay stubs (30 days)
- 2 months of bank statements
- Government-issued ID
"FHA is the great equalizer. If conventional says no, FHA often says yes — and at competitive rates." — Sam Tehranchi, Custom Mortgage Inc.
Custom Mortgage Inc. is an FHA-approved lender. NMLS #268582. Licensed in AZ, CA, FL, GA, TX.