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FHA Loan

Affordable loan option perfect for first-time homebuyers

Homeownership made easier with a low down payment

FHA loans are government-backed loans that offer consistent rates, low down payment requirements and flexible qualification guidelines. Although they are more flexible when it comes to down payments and credit backgrounds, there are some specific requirements.

Loan limit
FHA home loans have maximum mortgage limits that vary by state and county.

Mortgage insurance
All FHA loans require mortgage insurance which protects the lender against any loss if you fail to pay your mortgage.

Property requirements
The property must be appraised by an FHA-approved appraiser. In addition, FHA loans are available only for homes that:

  • Will be the buyer’s primary residence
  • Protect the health and safety of the occupants
  • Protect the security of the property
  • Do not have physical deficiencies or conditions affecting its structural integrity
Low down payment
Minimum 3.5% down payment
Lower credit score requirement
Minimum 620 credit score
FHA resources
To learn more, visit our Blog to read our First-Time Homebuyers Guides for Indiana and Illinois residents. You can also review our FHA Loan FAQs for answers to common questions.

Then connect with a Mortgage Expert today to further explore how these loans can make your dream of homeownership a reality.

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Here are the main advantages of an FHA loan:

  • Low down payment: Depending on your credit score, you may only be required to put 3.5% down. Keep in mind, putting less down could result in a higher interest rate.
  • Flexible qualification guidelines: FHA loans often have more flexible lending requirements than conventional loans.

The amount you pay is based on which type FHA mortgage insurance you have:

  • Upfront mortgage insurance premium (UFMIP): This is a one-time upfront charge of 1.75% of your loan amount that may be financed, gifted, paid by the seller or paid in full at closing.
  • Mortgage Insurance Premium (MIP): This is an annual insurance premium that’s paid monthly and is typically added to your monthly mortgage payment. MIPs range from 0.80% to 1.05% of the loan balance on a 30-year FHA loan and 0.45% to 0.95% of the loan balance on a 15-year FHA loan.
The amount you qualify for will depend on a variety of factors including credit score, debt-to-income (DTI) ratio and down payment. FHA loans have maximum mortgage limits that vary by state and county.
You may qualify for an FHA loan if you meet the general qualifications, including:

  • Credit score: The minimum credit score needed for an FHA loan is typically around 640.
  • Down payment amount: FHA loans require a minimum down payment of 3.5%.
  • Property requirements: The home must be used as your primary residence, should protect the health and safety of the residents and the safety of the property, and should not have physical deficiencies or conditions affecting its structural integrity. An FHA-approved appraiser must appraise the home.
FHA (Federal Housing Administration) mortgage loans are a popular option not just for first-time home buyers but for many who seek a more accessible route to owning a home. They are designed to make buying a home more achievable, especially for those who may not have a large down payment or perfect credit. 


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First Bank NMLS ID# 408968. Subject to credit approval. Other restrictions may apply. Property insurance required. See First Bank for details. The Equal Credit Opportunity Act prohibits lenders from discriminating against credit applicants in any aspect of a credit transaction on the basis of race, color, religion, national origin, sex, marital status, age, whether all or part of the applicant’s income comes from a public assistance program, or whether the applicant has in good faith exercised a right under the Consumer Credit Protection Act. The Fair Housing Act prohibits discrimination in residential real estate transactions on the basis of race, color, religion, sex, handicap, familial status, or national origin. Under these laws, a consumer cannot be refused a loan based on these characteristics nor be charged more for a loan or offered less favorable terms based on such characteristics. The content of this page is informational only. Account is subject to approval. The terms of the account, including any fees or features, are subject to change without prior notice except as required by law. Refer to product disclosure for the terms and conditions associated with the product. Other fees and charges may apply.