FHA Loans | Low Down Payment Home Loans | Convoy Home Loans

What Is an FHA Loan?

An FHA loan is a mortgage insured by the Federal Housing Administration (FHA), part of the U.S. Department of Housing and Urban Development (HUD). The federal government insures these loans for approved lenders, greatly reducing the lender's risk if a borrower defaults.

This insurance allows lenders to offer more lenient qualification standards, lower down payments, and more flexible credit requirements than conventional loans.

"An FHA loan is a mortgage loan that is insured by the Federal Housing Administration (FHA). Essentially, the federal government insures loans for FHA-approved lenders in order to reduce their risk of loss if a borrower defaults on their mortgage payments. The FHA program was created in response to the rash of foreclosures and defaults that happened in the 1930s; to provide mortgage lenders with adequate insurance; and to help stimulate the housing market by making loans accessible and affordable."

Key Benefits of FHA Loans

Low Down Payment

As little as 3.5% down for credit scores of 580 or higher.

Flexible Credit Requirements

Easier approval for borrowers with lower credit scores or past credit challenges.

Higher Debt-to-Income Ratios

More forgiving guidelines help buyers qualify with higher monthly obligations.

Seller Contributions

Sellers can contribute up to 6% toward closing costs.

Competitive Interest Rates

Often comparable to or better than conventional rates for qualified borrowers.

Available for Many Property Types

Single-family homes, condos, townhomes, and multi-unit properties (up to 4 units).

FHA loans are especially powerful in high-cost markets like San Diego where saving for a large down payment can take years.

Potential Drawbacks

Mortgage Insurance Premiums (MIP)

Upfront MIP + monthly MIP for the life of the loan (or until you reach 20% equity in some cases).

Loan Limits

FHA has county-specific maximum loan amounts (lower than conventional jumbo limits).

Property Condition Requirements

Homes must meet FHA's minimum property standards.

Occupancy Rule

Must be your primary residence (not investment properties).

Refinance Limitations

Stricter rules when refinancing compared to conventional loans.

Who Should Consider an FHA Loan?

FHA loans are ideal for:

First-time homebuyers in San Diego and Southern California

Buyers with credit scores between 580-680

Families with limited savings for down payment

Borrowers who have experienced recent credit events (late payments, collections, etc.)

Military families and veterans (often combined with VA benefits)

Anyone struggling to qualify under conventional guidelines

How an FHA Loan Works

Pre-Approval

We review your income, credit, and debt to determine your FHA buying power.

Find a Home

Work with your real estate agent to find an FHA-appraised property.

Appraisal & Underwriting

FHA-approved appraiser verifies property condition and value.

Closing

Pay the required down payment and upfront MIP; move into your new home.

Ongoing

Make timely payments and build equity. You may remove monthly MIP once you reach 20% equity.

We guide you through every step with clear communication and fast turnaround times.

FHA Loan vs. Other Options

Loan Type	Min Down Payment	Credit Score Flexibility	Mortgage Insurance	Best For
FHA Loan	3.5%	Excellent	Yes (lifetime in most cases)	First-time & lower credit
Conventional	3-5%	Moderate	PMI (removable)	Stronger credit buyers
VA Loan	0%	Very Good	None	Eligible veterans & service members
USDA Loan	0%	Good	Yes	Rural property buyers

Why Choose Convoy Home Loans for Your FHA Mortgage?

As a nationally licensed mortgage broker (NMLS #2130517) with offices in San Diego and El Segundo, we have deep expertise in FHA programs and strong relationships with multiple FHA-approved lenders. Our mission is to provide financing options that enhance your standard of living while treating you like family.

We help clients who have been turned down elsewhere get approved and close on time.

Ready to buy a home with only 3.5% down? Get pre-approved for an FHA loan today - no obligation.

Frequently Asked Questions

What credit score do I need for an FHA loan?

Minimum 580 for 3.5% down; scores as low as 500 may qualify with 10% down.

How long does FHA mortgage insurance last?

Upfront MIP is paid at closing. Monthly MIP usually lasts for the life of the loan unless you reach 20% equity and refinance.

Can I use an FHA loan to buy a condo in San Diego?

Yes - as long as the condo project is FHA-approved.

Are there income limits on FHA loans?

No income limits, but the loan must be for your primary residence.

Can I sell my home after getting an FHA loan?

Yes - FHA loans are fully assumable, which can be a big advantage when selling.

Do you offer FHA loans outside California?

Yes - we are licensed in many states and can assist eligible borrowers nationwide where permitted.

Convoy Home Loans · NMLS #2130517 · Licensed Mortgage Broker
AZ · CA · CO · FL · GA · ID · MD · MI · MN · NC · NM · OH · OR · PA · TN · TX · VA · WA and more
This is not a commitment to lend. All loans subject to credit approval. Equal Housing Lender.

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