**Minimum credit score (2025)**: 580+ for 3.5% down payment, 500-579 requires 10% down. **Down payment**: 3.5% minimum with 580+ score ($10,500 on $300k home), 10% minimum with 500-579 score ($30,000 on $300k). **Debt-to-income ratio**: Max 43% DTI (some lenders 50% with strong credit), includes mortgage + car + student loans + credit cards. **Employment**: 2 years steady employment or same field. **Property requirements**: Primary residence only, FHA appraisal required, must meet HUD minimum standards. **Loan limits (2025)**: $498,257 most areas, $1,149,825 high-cost areas. **Benefits**: Lower credit requirements than conventional, smaller down payment, seller can pay closing costs (up to 6%), assumable loans.

**Upfront MIP (2025)**: 1.75% of loan amount, financed into loan.

Example: $300,000 loan × 1.75% = $5,250 upfront MIP. **Annual MIP rates (2025)**: Base loan $726,200+: 0.15-0.75% annually.

Under $726,200: 0.45-0.80% annually.

Depends on loan amount, LTV, term. **Example calculation**: $300,000 loan, 30-year, 3.5% down (96.5% LTV) = 0.55% annual MIP. $300,000 × 0.55% ÷ 12 = **$137.50/month MIP**. **MIP removal rules**: 10% down or more: MIP removed after 11 years.

Less than 10% down: MIP for life of loan (cannot remove). **Workaround**: Refinance to conventional once 20% equity + 620 credit to eliminate MIP.

Most refinance after 5-7 years when home appreciates or principal paid down.

**FHA advantages**: 3.5% down vs 5-20% conventional, 580 credit vs 620+ conventional, easier DTI approval (50% vs 43%), seller-paid closing costs (6% vs 3%), streamline refinance option. **Conventional advantages**: No upfront MIP (saves 1.75%), PMI removable at 78-80% LTV, higher loan limits, lower monthly insurance (0.3-1.5% vs 0.55%+ FHA), investment properties allowed. **Cost comparison** ($300k loan, 3.5% down, 30 years, 7% rate): **FHA total**: Down $10,500 + Upfront MIP $5,250 + Monthly payment $1,996 + MIP $137 = **$2,133/month**. **Conventional** (5% down): Down $15,000 + Monthly $1,897 + PMI $125 = **$2,022/month** (PMI removable). **Best for FHA**: Credit 580-680, 3.5-5% down available, DTI 43-50%, first-time buyers. **Best for conventional**: Credit 700+, 5-20% down, DTI under 43%, plan to stay 10+ years or refinance.

**Typical FHA closing costs (2025)**: Origination fee 0.5-1% ($1,500-$3,000 on $300k), Appraisal $500-$700, Credit report $50-$100, Title insurance $1,000-$2,000, Title search $200-$400, Survey $300-$500, Recording fees $100-$300, Attorney $500-$1,500. **Total closing costs**: 2-5% of loan amount ($6,000-$15,000 on $300k loan). **Cash needed at closing** ($300k purchase, 3.5% down): Down payment $10,500 + Closing costs $8,000 (seller pays $6,000) = **$12,500 total**. **Closing cost help**: Seller concessions up to 6% ($18,000 on $300k), FHA allows full 6% vs 3% conventional.

Lender credits (higher rate for credits).

Down payment assistance programs (state/local grants $3,000-$15,000). **Gift funds**: 100% down payment can be gift from family (not loan), must document source, gift letter required.

**2025 FHA loan limits**: Floor (most counties) $498,257, High-cost counties (SF, NYC, HI) up to $1,149,825, Alaska/Hawaii/Virgin Islands special limits. **Checking your limit**: Visit HUD website + enter zip code, varies by county not state, updated annually. **Exceeding limits**: Option 1 - Conventional loan (no limit, but stricter), Option 2 - Jumbo loan (higher rates), Option 3 - Two loans (FHA + second mortgage, rare). **Down payment if near limit**: $490,000 home in $498,257 limit area = 3.5% down works. $550,000 home in $498,257 limit = FHA covers $498,257, pay $51,743 down (9.4% total) or use conventional. **High-cost area strategy**: Bay Area limit $1,149,825 means $1.1M home with 3.5% down ($40k) possible on FHA vs $220k (20%) conventional.

**FHA 203(k) Rehabilitation Loan**: Buy + renovate in single loan, includes purchase price + repair costs, minimum $5,000 repairs required, maximum based on after-repair value. **Two types**: Standard 203(k) - major renovations ($35,000+), structural changes, additions.

Limited 203(k) - minor repairs (max $35,000), cosmetic updates, appliances. **Example**: $250,000 fixer purchase + $50,000 repairs = $300,000 loan. 3.5% down on $300,000 = $10,500. **New construction FHA**: Allowed if builder participates, 3.5% down on new homes, builder cannot exceed FHA limits, home must be completed or under FHA-approved builder program. **Inspection requirements**: FHA appraisal strict - checks foundation, roof, HVAC, electrical, plumbing, no peeling paint, working utilities required before closing.