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FHA loan rates
By Dhara Singh
On Tuesday, January 25, 2022, the national average 30-year FHA mortgage APR is 4.000%. The average 30-year FHA refinance APR is 4.020%, according to Bankrate’s latest survey of the nation’s largest mortgage lenders.
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Today's national FHA mortgage rate trends
For today, Tuesday, January 25, 2022, the national average 30-year FHA mortgage APR is 4.000%, up compared to last week’s of 3.930%. The national average 30-year FHA refinance APR is 4.020%, flat compared to last week’s of 4.020%.
Whether you're buying or refinancing, Bankrate often has offers well below the national average to help you finance your home for less. Compare rates here, then click "Next" to get started in finding your personalized quotes.
We’ve determined the national averages for mortgage and refinance rates from our most recent survey of the nation’s largest refinance lenders. Our own mortgage and refinance rates are calculated at the close of the business day, and include annual percentage rates and/or annual percentage yields. The rate averages tend to be volatile, and are intended to help consumers identify day-to-day movement.
About our Mortgage Rate Tables: The above mortgage loan information is provided to, or obtained by, Bankrate. Some lenders provide their mortgage loan terms to Bankrate for advertising purposes and Bankrate receives compensation from those advertisers (our "Advertisers"). Other lenders' terms are gathered by Bankrate through its own research of available mortgage loan terms and that information is displayed in our rate table for applicable criteria. In the above table, an Advertiser listing can be identified and distinguished from other listings because it includes a "Next" button that can be used to click-through to the Advertiser's own website or a phone number for the Advertiser.
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Today’s FHA loan rates
The table below brings together a comprehensive national survey of mortgage lenders to help you know what are the most competitive FHA loan rates. This interest rate table is updated daily to give you the most current rates when choosing an FHA mortgage home loan.
| Product | Interest Rate | APR |
|---|---|---|
| 30-Year FHA Rate | 3.160% | 4.000% |
| 30-Year Fixed Rate | 3.680% | 3.730% |
| 20-Year Fixed Rate | 3.540% | 3.590% |
| 15-Year Fixed Rate | 3.020% | 3.140% |
| 10/1 ARM Rate | 3.180% | 4.040% |
| 7/1 ARM Rate | 2.950% | 3.980% |
| 5/1 ARM Rate | 2.790% | 4.070% |
| 30-Year VA Rate | 3.180% | 3.310% |
| 30-Year Fixed Jumbo Rate | 3.670% | 3.740% |
| 15-Year Fixed Jumbo Rate | 3.060% | 3.110% |
| 7/1 ARM Jumbo Rate | 2.960% | 3.990% |
| 5/1 ARM Jumbo Rate | 2.740% | 4.040% |
Rates as of January 25th, 2022 at 6:30 AM
Top 5 Bankrate FHA lenders
- Cardinal Financial Company – Best for low-credit score borrowers
- LowRates.com – Best overall
- Cherry Creek Mortgage – Best for first-time homebuyers
- Renasant Bank – Best bank lender
- Garden State Home Loans – Best online lender
Methodology
Bankrate helps thousands of borrowers find mortgage and refinance lenders every day. To determine the top mortgage lenders, we analyzed proprietary data across more than 150 lenders to assess which on our platform received the most inquiries within a three-month period. We then assigned superlatives based on factors such as fees, products offered, convenience and other criteria. These top lenders are updated regularly.
Cardinal Financial Company – Best for low-credit score borrowers
Cardinal Financial Company, which also runs Sebonic Financial, is a mortgage lender available across the U.S., offering an array of loan products including FHA loans.
Strengths: Like many mortgage lenders, Cardinal Financial Company offers FHA loans to borrowers with lower credit scores (as low as 550 or 580), as well as other types of loans with some credit flexibility (620 for a conventional loan, 550 for a VA loan and 580 for a USDA loan). One key benefit: The lender’s proprietary system, Octane, guides borrowers throughout the home loan process with a customized to-do list.
Weaknesses: While you can easily learn Cardinal Financial’s credit and down payment requirements for specific products online, you won’t be able to find information regarding interest rates or fees. To receive a quote and cost details, you’ll need to contact a loan officer.
Read Bankrate's Cardinal Financial Company mortgage review
LowRates.com – Best overall
LowRates.com, operated by Sun West Mortgage Company, is a widely available online lender, with licenses in 48 states, Puerto Rico and the U.S. Virgin Islands.
Strengths: Sun West Mortgage Company has an A+ rating with the Better Business Bureau. In line with other lenders, LowRates.com can do FHA loans for borrowers with a credit score as low as 500. In addition, the lender typically closes loans in 20 days.
Weaknesses: The lender isn’t licensed in Georgia or Massachusetts.
Read Bankrate's LowRates.com mortgage review
Cherry Creek Mortgage – Best for first-time homebuyers
Cherry Creek Mortgage, which also does business as Blue Spot Home Loans and under a few other names, lends mortgages in 33 states.
Strengths: Cherry Creek Mortgage offers several low-down payment loan programs, including Conventional 97 and HomeReady loans and FHA, VA and USDA loans. The lender’s website includes educational resources for first-time homebuyers, including a free downloadable guide to homeownership.
Weaknesses: Cherry Creek Mortgage isn’t available in every state, and for FHA loans, it requires a minimum 620 credit score, which is higher than what some other lenders will accept.
Read Bankrate's Cherry Creek Mortgage review
Renasant Bank – Best bank lender
Renasant Bank is a bank and lender with branches in Alabama, Florida, Georgia, Mississippi and Tennessee.
Strengths: As with other mortgage lenders, Renasant Bank allows you to lock in a competitive rate for up to 60 days. Because it’s a regional bank, Renasant has more of a local feel, which can enhance the borrower’s experience. The bank also offers Community Home Improvement loans, which could be useful if you’re looking to make repairs to your home.
Weaknesses: Renasant Bank is only available in certain states, and doesn’t offer interest rate information online.
Read Bankrate's Renasant Bank mortgage review
Garden State Home Loans – Best online lender
Garden State Home Loans is a smaller online lender with one brick-and-mortar location in New Jersey. The lender offers the basic slate of mortgage products, including FHA loans.
Strengths: You can inquire about Garden State Home Loans’ products and interest rates in seconds online using a convenient chat feature, and the lender charges no hidden fees. Bonus: Its average loan turnaround time is approximately three weeks.
Weaknesses: Garden State Home Loans isn’t available in all states; it only does business in Connecticut, Delaware, Florida, Maryland, Michigan, New Jersey, New York and Pennsylvania.
Garden State Home Loans review
What is an FHA loan?
Federal Housing Administration (FHA) loans are government-backed mortgages for single-family and multifamily homes.
FHA-backed loans typically have lower income and credit score requirements than conventional mortgages. FHA loans also only require a minimum 3.5 percent down payment, which is helpful for buyers who don’t have a lot of funds saved for a big lump sum payment. These are two reasons FHA loans are so popular among first-time homebuyers, people on tight budgets and folks who have lower credit scores.
FHA loans do require FHA mortgage insurance for homebuyers who put down less than 20 percent. All FHA borrowers must pay two insurance premiums: the upfront mortgage insurance premium (1.75 percent of the base loan amount) and an annual mortgage insurance premium. The annual premium is based on loan terms, loan amount and the loan-to-value ratio. Keep these extra costs in mind when you’re budgeting for a home.
Who is an FHA loan for?
An FHA loan can be a viable path to homeownership for many types of buyers. Here we’ll look at two scenarios where FHA loans might make sense.
Borrowers with a sub-620 credit score
Most lenders call for a minimum credit score of 620 for conventional loans, whereas FHA loans have looser requirements. Homebuyers can have a score as low as 500 and still be eligible for an FHA loan. However, lower scores also mean higher down payments. Here’s what FHA requires:
- 580 credit score to qualify for a 3.5 percent down payment
- 500 to 579 credit score must have a minimum 10 percent down payment
One caveat: Since the coronavirus pandemic began, FHA lenders have proven less willing to approve loans for borrowers with the lowest credit scores.
Borrowers with a low down payment
Many of today’s buyers, especially when purchasing their first home, find saving for a down payment challenging. As housing costs rise and people are saddled with student loan debt, many folks need a loan with low down payment requirements.
FHA loans require only 3.5 percent down (if you have a minimum 580 credit score). This is good news for folks who would otherwise be required to make a larger upfront payment.
FHA loan requirements
FHA loans vary by loan term, rate type and use:
- 30- or 15-year term
- Fixed- or adjustable-rate
- Purchase, rehab or refinance
An FHA loan can be used to buy or fix up a property or refinance an existing mortgage. You can obtain a loan for either a 15-year or 30-year term. While a 15-year loan allows you to pay off your mortgage off sooner and comes with a lower interest rate, you’ll make higher monthly payments. A 30-year loan, on the other hand, has a higher interest rate but lower monthly payments spread out over a longer term.
FHA loans can also differ in terms of how the interest rate is structured. With a fixed-rate FHA loan, the interest rate stays the same for the duration of the repayment period (unless you refinance later to a lower rate). With an FHA adjustable-rate mortgage (ARM), the interest rate can increase or decrease after a certain period of time and at predetermined intervals. This type of loan generally comes with a lower interest rate upfront.
FHA loan requirements
- Steady employment history
- Ability to pay
- Financial soundness
- Residency
Do FHA loans have lower interest rates?
FHA loans do not typically have lower rates overall compared to conventional loans, although you might see lower interest rates advertised. For example, you might see a lower interest rate on an FHA loan compared to the interest rate on a conventional loan, but the FHA loan’s annual percentage rate, or APR, is higher. APR includes all of the fees associated with the loan.
FHA loan vs. 30-year fixed loan
See the table below for an example of the costs associated with an FHA loan versus a 30-year fixed loan. Keep in mind, interest rates are dependent on the market and the borrower's creditworthiness.
| FHA Loan | 30-Year Fixed Loan | |
|---|---|---|
| House price | $300,000 | $300,000 |
| Loan amount | $294,750 | $289,500 |
| Interest rate | 2.91% | 3.07% |
| Principal + interest | $1,228 | $1,231 |
| Mortgage insurance | $205 | $121 |
| Total monthly payment | $1,433 | $1,352 |
As you dive deeper into the homebuying process, it’s important to weigh the pros and cons of each loan option. Here are the pros and cons of FHA loans.
Advantages of FHA loans
- Low down-payment requirements
- Friendly to first-time homebuyers (includes those who have not owned a home for at least three years)
- Financing for mobile homes and factory-built homes
- May accommodate people who own the land where the home will be located and those who live in a mobile home park
- Can lock in a low rate without a large down payment
Disadvantages of FHA loans
- Borrower required to pay two types of mortgage insurance: upfront mortgage insurance premium (MIP) and an annual premium
- Require that the house meet certain standards, which decreases buying options
Best FHA mortgage lenders
The majority of mortgage lenders offer FHA loans. Here are some of the best FHA mortgage lenders today:
For more information on FHA loans:
- Everything to know about FHA loans: Learn how FHA loans work and how to qualify
- How to find the best FHA lender: Follow these tips to find the right lender for you
- FHA mortgage insurance guide: Weigh the pros and cons of mortgage insurance
- Using a FHA mortgage to buy and repair a home: Get tips for using an FHA loan to remodel
- Bankrate's best FHA lenders
Written by: Dhara Singh, mortgage reporter for Bankrate
Dhara Singh is a mortgage reporter for Bankrate. She is a former data analyst turned financial journalist who previously worked at Yahoo Finance, CNET, Cashay.com and JPMorgan Chase covering the housing and retirement beats.
| Loan Type | Purchase Rates | Refinance Rates |
|---|---|---|
| The table above links out to loan-specific content to help you learn more about rates by loan type. | ||
| 30-Year Loan | 30-Year Mortgage Rates | 30-Year Refinance Rates |
| 20-Year Loan | 20-Year Mortgage Rates | 20-Year Refinance Rates |
| 15-Year Loan | 15-Year Mortgage Rates | 15-Year Refinance Rates |
| 10-Year Loan | 10-Year Mortgage Rates | 10-Year Refinance Rates |
| FHA Loan | FHA Mortgage Rates | FHA Refinance Rates |
| 30-Year FHA Loan | 30-Year FHA Loan Rates | 30-Year FHA Refinance Rates |
| VA Loan | VA Mortgage Rates | VA Refinance Rates |
| ARM Loan | ARM Mortgage Rates | ARM Refinance Rates |
| 5/1 ARM | 5/1 ARM Rates | 5/1 Refinance Rates |
| 7/1 ARM | 7/1 ARM Rates | 7/1 Refinance Rates |
| 10/1 ARM | 10/1 ARM Rates | 10/1 Refinance Rates |
| Jumbo Loan | Jumbo Mortgage Rates | Jumbo Refinance Rates |
| 30-Year Jumbo Loan | 30-Year Jumbo Loan Rates | 30-Year Jumbo Refinance Rates |
Calculators
Related Links
- 30-year mortgage rates
- 20-year mortgage rates
- 15-year mortgage rates
- 10-year mortgage rates
- VA loan rates
- FHA loan rates
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