Best FHA Loan Lenders

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If you can’t put down 20% on a new home purchase, use our guide to research the best FHA loan lender for you. We explain how FHA loans help many Americans achieve the dream of owning a home. Your credit score doesn’t have to be perfect to apply for an FHA loan, and you only have to put down a 3.5% down payment.

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Compare our top 3 choices for best FHA lenders

When weighing our favorite FHA lenders we considered which lenders are most likely to provide a superior experience for home buyers and a mortgage that is affordable in the long run. We also considered interest rates, customer service, transparent pricing, minimum credit scores, debt-to-income ratio requirements, additional services and consumer reviews.

Note that our picks may be Authorized Partners who compensate us. This does not affect our recommendations or evaluations but may impact the order in which companies appear.

Our favorite FHA lender overall AmeriSave Mortgage
  • Minimum credit score: 600
  • Minimum down payment: 3.5%
  • Maximum debt-to-income ratio: 45%

One of AmeriSave Mortgage’s specialties is FHA mortgages. Refinancing into an FHA mortgage, either from a conventional loan or an existing FHA loan, is also an option. AmeriSave offers upfront rates (interest rates and APRs) for FHA loans and FHA refinancing on their website, taking into account the loan amount, loan-to-value ratio, geographical location and credit score. It takes an average of 33 days for borrowers to move from AmeriSave guaranteeing a rate to the actual funding. Terms are available in the length of 5, 7, 10, 15, 20, 25 or 30 years with both fixed and adjustable rates.

Applicants can receive incentives ranging from $250–$4,500 for purchasing homes within AmeriSave’s affiliated network. Applicants can also choose for closings to be held at their home or a local AmeriSave office. Throughout the process, each applicant will be able to rely on a dedicated loan officer and loan processor for assistance. General customer service is available from 7 am to 4 pm CST. AmeriSave is licensed in the District of Columbia and every state except New York and Iowa.

Great FHA lender for bad credit Freedom Mortgage
  • Minimum credit score: 600
  • Minimum down payment: 3.5%
  • Maximum debt-to-income ratio: 45%

Freedom Mortgage offers a variety of loan types at different rates, and they are willing to work hard to make the loan work for you, even if you have low credit. Loans come with both fixed and adjustable rates. Unlike some other companies, Freedom Mortgage does not use points. Their fixed-rate loans come in terms of 15, 20 and 30 years. Adjustable-rate loans are available in 3/1, 5/1, 7/1 and 10/1 terms. If you are looking to buy a fixer-upper, it’s worth looking into one of Freedom Mortgage’s FHA 203(k) loans.

Freedom Mortgage’s “Close-On-Time Guarantee” means that, if your loan doesn’t close on time, they’ll foot the bill for your first month’s mortgage, up to $2,500. You are also able to lock rates that you like for up to 60 days. Consumers can to apply online on the Freedom Mortgage website. The process is entirely digital, including the pre-application process and correspondences afterward by email. If you would prefer to speak to a real person, a licensed loan specialist can assist you. However, there are physical locations in only 15 states. Freedom Mortgage is licensed for business in 45 states and the District of Columbia. Mortgages are unavailable in Hawaii, Missouri, Montana, Nevada and New York.

Great online FHA lender Homebridge Financial Services
  • Minimum credit score: 550
  • Minimum down payment: 3.5%
  • Maximum debt-to-income ratio: 43%

Homebridge Financial is known for their efficient, easy-to-use online services. Creating an account online allows consumers to speak to mortgage loan originators directly and track their application throughout the entire process. These local mortgage loan originators can meet with you in person or guide you through the process online. Homebridge also have a wealth of educational material and tools on their website, making it easy for homebuyers to learn the ins and outs of the FHA loan application process.

Homebridge has physical locations in 30 states but is licensed for business in all 50 states. Homebridge’s minimum credit score of 550 for FHA loans (and all other government-backed loans) is one of the lowest around, making it an appropriate choice for those with weaker credit. The company is a good choice if you are looking to refinance an existing FHA loan, whether that be for lower payments, shorter pay-off term, lower interest costs or cash out. Homebridge also offers FHA 203(k) loans for those who are interested in renovating their home. The company’s FHA Energy Efficient mortgages are a good choice for those looking to save money on utilities by converting their house into an energy-efficient home. Last of all, Homebridge’s FHA 203(h) loans help homeowners rebuild after a natural disaster.

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What is an FHA mortgage?

An FHA mortgage is a government-backed home loan from the Federal Housing Administration. It’s a popular choice among first-time homebuyers and those with less-than-stellar financial histories because of its flexible terms and low down payment requirements.

That said, in order to qualify for an FHA loan, the home you want to purchase must pass the FHA’s structural safety requirements, and the loan amount you need must fall within the FHA loan limits for your area.

» MORE: Best mortgage lenders for first-time buyers

FHA mortgage requirements

One of the most significant requirements for an FHA mortgage is the minimum credit score. A borrower with a credit score of at least 580 can make a down payment as low as 3.5% of the home’s purchase price. A borrower with a credit score between 500 and 579 must put at least 10% down. You will need to provide proof of income for the past two years, and you’ll typically need to have a debt-to-income ratio of 43% or less.

Buyers will also be required to pay a one-time upfront mortgage insurance premium (UFMIP) of 1.75% of the base loan amount. Additionally, there is a monthly MIP that varies depending on the loan’s size, term and other factors. Buyers are typically required to pay it for the life of the loan if they make a down payment of less than 10%.

Finally, the home being purchased must meet the following requirements:

  • It must pass an inspection to ensure it is safe and inhabitable.
  • It must be your primary residence.
  • It must be appraised by an FHA-approved appraiser.

» MORE: What credit score is needed to buy a house?

Pros and cons of FHA mortgages

While FHA loans allow a wider range of buyers to qualify for a mortgage, they aren’t the best choice for everyone. “If you have a higher credit score or a larger down payment, you may be able to qualify for a conventional loan with better terms and lower costs,” said Michael Winkler, a 30-year real estate veteran and the co-founder of Sell Home Today. “FHA loans come with higher mortgage insurance premiums, which can add to the overall cost of the loan.”

Consider the pros and cons of an FHA loan before choosing this type of mortgage.


  • Flexible credit score requirements
  • Low down payment requirements
  • No minimum or maximum income


  • Upfront and monthly mortgage insurance premiums
  • Strict property requirements
  • Maximum loan amounts

How to apply for an FHA mortgage

There are two main steps to applying for an FHA mortgage. First, you need to qualify as a buyer with an FHA lender; not every lender offers FHA loans. Once you are preapproved to buy a home, you will need to find a property that meets all of your lender’s requirements. Charming fixer-uppers typically don’t make the list.

In order to get preapproved for an FHA loan, you will likely need to prepare the following:

  • Identification: Provide your Social Security number, driver’s license or passport and current mailing address.
  • Income and employment verification: Lenders want to see recent pay stubs and the past two years’ tax returns.
  • Savings verification: Recent statements from all of your bank and investment accounts will show the down payment amount you’re capable of making.
  • Debt verification: Outstanding balances — such as car loans, student loans, and credit card debts — affect your candidacy for a mortgage.
  • Gift letter: Anyone who has given you funds for a down payment without the expectation that those funds will be repaid needs to sign a letter indicating as much.

Expect to resubmit the most updated versions of these documents several times later on as you go through the application and underwriting process. You might also have to provide further documentation to help your lender get the complete picture of your financial history and situation.

» MORE: How to apply for a mortgage

FHA mortgage alternatives

An FHA mortgage is not for every buyer. Some buyers would be better off choosing one of these FHA mortgage alternatives instead:

  • Conventional loan: If you have a credit score of at least 620 and some money to put down, you might be able to score a lower interest rate with a conventional loan versus an FHA loan.
  • VA loan: VA loans are backed by the U.S. Department of Veterans Affairs and are available to eligible veterans, active-duty military personnel and surviving spouses. For those who qualify, VA loans require 0% down and can have low closing costs.
  • USDA loan: USDA loans are backed by the U.S. Department of Agriculture. They have strict requirements for where you can buy your home, but if you qualify, you won’t be required to make a down payment, and you may get a competitive interest rate.

When you find a lender you want to work with, you can ask for a rate and cost comparison of the loan types you qualify for. Government-backed loans tend to have more flexible down payment and credit score requirements than conventional loans, but they may also come with additional fees. For example, USDA loans come with a 1% fee on your initial loan amount and an annual 0.35% fee on your remaining loan balance for the life of your loan.


When is an FHA mortgage a good idea?

An FHA mortgage can be a good idea if you have limited funds for a down payment, a low credit score or relatively high debt-to-income ratios. If you don’t qualify for a conventional loan, don’t give up your home dreams just yet; an FHA loan might be the solution.

Do all lenders offer FHA mortgages?

Not all lenders offer FHA mortgages, but many do. You might find that newer online mortgage lenders specialize in straightforward conventional mortgages for the sake of simplicity.

Can I get an FHA loan as a first-time homebuyer?

Yes. FHA loans are a great option for first-time homebuyers because their down payment and credit score requirements aren’t very stringent. An FHA loan can help a buyer get into a dream home faster instead of waiting years to save up a 20% down payment.

Why would a seller not accept an FHA loan?

Sellers want to sell their homes for as much money as they can with as few complications as possible. Sometimes FHA loans can put sellers in a tough spot because these types of loans require a home to be appraised for a certain amount and pass a thorough inspection. If a seller doesn’t want to deal with fixing a structural issue, such as a leaky roof, they may choose to forgo FHA buyers altogether.

Not sure how to choose?

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    ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work.
    1. Consumer Financial Protection Bureau, “FHA loans.” Accessed May 9, 2023.
    2. U.S. Department of Housing and Urban Development, “Document 4150.” Accessed May 10, 2023.
    3. Fannie Mae, “What is required to document gift funds?” Accessed May 11, 2023.
    4. U.S. Department of Agriculture, “Upfront Guarantee Fee & Annual Fee.” Accessed May 11, 2023.

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