Federal Housing Administration (FHA) Mortgage

If you require a smaller down payment or are using a down payment from other sources such as a gift, this may be the perfect mortgage for you. This is a more flexible mortgage loan option for first-time home buyers or those with past credit issues.

For those just starting out, an FHA loan may be a good option to help you fulfill your home dreams. While these loans do not come directly from the FHA, the FHA guarantees the loan which reduces the lending risk and may give you more borrowing power. You also may have better rates due to FHA home loan insurance.

It's important to note that FHA properties must meet certain requirements (below) that both sellers and buyers should be aware of in advance.

Repair Requirements

Anything that would jeopardize the health and safety of the occupants
Protect the security of the property
Correct physical deficiencies or conditions affecting structural integrity of the property

Typical Conditions that Would Require Further Inspection or Testing

Inadequate access/egress from bedrooms to exterior of home
Leaking or worn out roofs (if there are three or more layers of shingles on leaking or worn out roof, all shingles must be removed before re-roofing)
Evidence of structural problems (such as foundation damage caused by excessive settlement)
Defective paint surfaces in homes constructed pre-1978
Defective exterior paint surfaces in homes constructed post-1978
Inoperative/inadequate plumbing, heating or electrical systems
Structural failure in framing members
Drainage problems

Ineligible Property Issues

Excess land
Not a residential property
Properties with hazardous environmental contaminants
Noxious odors
Offensive sights
Excessive noises
Soil contamination
Underground storage tanks
Manufactured homes

Other Requirements

Utilities must be turned on and appraiser must check for proper working order.
Wells must be located a minimum of 100 feet from the septic tank’s drain field and a minimum of 10 feet from any property line. If state or local laws require greater distances, those distances must be met.

Your mortgage lender is the best resource when it comes to FHA loans.

Choose a Lender

All mortgage loans subject to credit approval.