In 2023, the maximum FHA loan amount increases in more than three thousand counties. Only 12 counties will remain unchanged. When it comes to FHA HECM loans, maximum claim amounts increase from $970,800 (2022) to $1,089,300 (2023) effective for FHA case numbers assigned on or after January 1, 2023.
Current FHA loan rates. Since the pandemic, rates on FHA loans have bounced around — from less than 3 percent during the pandemic to 8 percent in 2023 to closer to 6 percent as of September 2024.
FHA minimum credit score
If you put just 3.5 percent down, the minimum credit score for an FHA loan is 580. You can qualify with a score as low as 500, but you'll need to make at least a 10 percent down payment.
FHA First Mortgage
Borrower must have owned property for 12 months AND if encumbered by a mortgage made payments for the last 12 months within the month due. Otherwise limited to 85% LTV. Standard 31/43 ratios, may be exceeded with compensating factor(s).
FHA Loan: Cons
Here are some FHA home loan disadvantages: An extra cost – an upfront mortgage insurance premium (MIP) of 2.25% of the loan's value. The MIP must either be paid in cash when you get the loan or rolled into the life of the loan. Home price qualifying maximums are set by FHA.
If you're currently in the market looking to buy a triplex or fourplex with FHA financing, you need to see if the property's rents pass the Self-Sufficiency Test. To be “self-sufficient” means that 75% of the property's rents need to cover the monthly payments.
You may be denied for an FHA loan if you have declared bankruptcy but you have not had the bankruptcy discharged. You may be denied if you are delinquent on federal taxes or otherwise owe money to the federal government but without an approved payment plan.
In summary, here's what we found: You need to make at least $54,000 per year to afford a $200,000 house. You need to make at least $81,000 per year to afford a $300,000 house. You need to make at least $109,000 per year to afford a $400,000 house.
What is the typical mortgage down payment for first-time homebuyers versus repeat homebuyers? As of 2023, the typical mortgage down payment for a first-time homebuyer was 8 percent, while the typical down payment for a repeat homebuyer was 19 percent, according to the National Association of Realtors.
National 30-year fixed FHA mortgage rates remain stable at 6.33% The current average 30-year fixed FHA mortgage rate remained stable at 6.33% on Saturday, Zillow announced. The 30-year fixed FHA mortgage rate on January 11, 2025 is up 75 basis points from the previous week's average rate of 5.58%.
Current Forecasts and Expert Opinions
The short answer is: It's highly unlikely we'll see mortgage rates drop back to 3% anytime soon. However, recent inflation numbers point to cooling of the pace of inflation.
The lowest average mortgage rates on record came about when the Federal Reserve lowered the federal funds rate in 2020 and 2021 in response to the pandemic. As a result, the weekly average 30-year, fixed-rate mortgage fell to 2.65%, while the average 15-year, fixed-rate mortgage sunk to 2.10%.
The answer to this question is "no." There are no minimum income requirements for FHA loans.
Changes to property taxes
Property tax rates change due to government policy decisions, rising or declining home values and reassessments, and even when homeowners renovate or improve their property. In addition, if you have a property tax exemption and it expires, your mortgage payment could increase.
An FHA loan may be a better option if you have a lower credit score, a higher DTI ratio, or less money saved for a down payment. On the other hand, a conventional loan may work better if your finances are sound and you can qualify for favorable loan terms.
The house you can afford on a $70,000 income will likely be between $290,000 to $360,000. However, your home-buying budget depends on quite a few financial factors — not just your salary.
The FHA approves loan amounts based on factors like your credit score, living expenses, assets, debt-to-income ratio, household income, and the value of the property. As of 2025, the FHA maximum loan limit for a one-unit property is $524,225 in low-cost areas and $1,209,750 in high-cost areas.
Your monthly payment for a $300,000 mortgage and a 30-year loan term could range from $1,798 to $2,201, depending on your interest rate and other factors. Learn more about the upfront and long-term costs of a home loan.
While some sellers may be hesitant to accept an FHA offer, it's important to understand the facts before making a decision. Some reasons a seller might refuse an FHA loan include misconceptions about longer closing times, stricter property requirements, or the belief that FHA borrowers are riskier.
FHA-specifics
If you can show proof that you have now been employed for at least a six-month period before requesting a FHA loan, AND that before any employment gap you worked for two-years straight or longer, you have the potential to get approved.
Exceptions to the Rule: When You Can Have Multiple FHA Loans
The FHA recognizes that life circumstances can necessitate having more than one FHA loan. To be eligible for a second FHA loan, you must have at least 25% equity in your home or have paid down the FHA loan balance to 75% in certain circumstances.