5 Myths About FHA Loans

• Myth 1: FHA loans are only for first-time homebuyers

  • Fact: Anyone can qualify if they meet financial requirements; first-timers benefit due to lower credit scores and down payments.

• Myth 2: You can’t get an FHA loan if you have student loans

  • Fact: Student loans are factored into the debt-to-income ratio, but new guidelines allow for deferred or zero-payment loans to be treated as 0.5% of the balance.

• Myth 3: A 20% down payment eliminates the need for FHA mortgage insurance

  • Fact: Mortgage insurance is required regardless of down payment size. If 10% is paid, MIP may drop off after 11 years.

• Myth 4: There are income limits for FHA loans

  • Fact: No income limits, but you need a two-year employment and credit history.

• Myth 5: FHA loans are only for single-family homes

  • Fact: FHA loans can cover 1-4 unit properties, manufactured homes, and even allow additional funds for home repairs (up to $35,000 via the 203(k) program).