FHA loans: flexible financing insured by the FHA

How FHA loans work

FHA doesn't lend money. Approved lenders make the loan, and FHA insures it against default. In exchange, borrowers pay mortgage insurance: an upfront premium, often financed into the loan, plus a monthly premium.

FHA loans can be used to buy a home or refinance. The FHA 203(k) program, which can finance repairs along with the purchase, may be available through some wholesale lenders, subject to program and lender guidelines.

Who FHA fits

• First-time buyers
• Buyers with limited savings for a down payment
• Borrowers rebuilding credit
• Buyers who need more flexible debt-to-income guidelines
• Buyers who plan to live in the home

Property rules

FHA loans are for owner-occupied homes. They can cover single-family homes, FHA-approved condos and small multi-unit properties where you live in one unit. The home must meet FHA property standards, checked during the appraisal. FHA loan limits apply and vary by county.

Documents you may need

Pay stubs, W-2s or tax returns, bank statements, ID, and explanations for credit events. Self-employed borrowers typically provide tax returns.

Pros and cons

Pros: Flexible credit and down payment guidelines for eligible borrowers; gift funds allowed under program rules; streamline refinance may be available; may be assumable by qualified buyers, subject to lender approval.

Cons: Mortgage insurance adds to cost and may last the life of the loan in many cases; county loan limits; property standards; primary residence only.

FHA streamline refinance

If you already have an FHA loan, an FHA streamline refinance may let eligible borrowers refinance with less paperwork. FHA requires the refinance to provide a net tangible benefit, such as a lower payment.

How Turn Times helps

Turn Times is a licensed mortgage broker, not a lender. Instead of offering one company's products, we compare FHA loan options from wholesale lenders and walk you through the differences in plain language. Here's how it usually goes:

1. Tell us your goal. A short conversation about the property, your timeline and what matters most to you.
2. We search pricing across wholesale lenders. We look at which wholesale lenders' guidelines may fit your situation, and a licensed loan officer compares their pricing and terms.
3. You choose. We lay out the trade-offs so you can pick the option that works for you.
4. We manage the loan to closing. Appraisal, title, conditions and updates along the way.

Every loan is subject to the lender's underwriting, and approval isn't guaranteed. We arrange loans for properties in California and Colorado.

Frequently asked questions