From about 3.5% down

The most forgiving program if your credit has a history.

Backed by the Federal Housing Administration, which is why it tolerates more in your past than anything else on this list. A lot of first-time buyers land here, and a lot of people who had a rough couple of years and have since recovered.

Start your application Call (580) 284-7244

What it takes

The requirements, in plain terms.

Credit

The most flexible of the common programs on past trouble — collections, a thin file, a late stretch that has since been put right.

Down payment

About 3.5% of the purchase price. It can be a gift from family, provided there is a signed letter saying it is a gift and not a loan.

Income

Documented, and measured against your total monthly debts. FHA is generally more permissive on that ratio than conventional.

Occupancy

Primary residence only.

The property

This is the one that surprises people: the house must meet HUD's minimum condition standards. Peeling paint, a roof at the end of its life or missing handrails can hold up an FHA file until they are fixed.

Documents

What to have ready.

Requested once, up front, rather than in dribs — missing paperwork is what actually delays a file. The full checklist by how you're paid is on the loan programs page.

Pay stubs covering the last 30 days
W-2s for the last two years
Two months of bank statements — every page, even the blank ones
Photo ID
Two years of addresses and your employer's name and number
A signed gift letter if any of the down payment is coming from family

Full document checklist

The part worth knowing

What people find out too late.

FHA carries mortgage insurance, and with less than 10% down it generally stays on the loan for as long as you keep it — the usual exit is refinancing later rather than reaching 20% equity. That is not a reason to avoid FHA, and for a lot of buyers it is the difference between owning and not. It is a reason to know it going in.

Answers

Questions about fha loans.

General answers. Every file is different, so treat these as a starting point rather than a quote.

Can the seller help with closing costs?

Yes, and FHA is relatively generous about how much a seller is allowed to contribute. It is worth negotiating for — it frees up cash you were going to spend at the table.

What if the house fails the condition standards?

Usually the seller repairs the items before closing, or the price is renegotiated to account for them. Lucy will tell you early if a property looks likely to trip this, which is why sending her the listing is worth doing.