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FHA loan rates

On Monday, February 26, 2024, the national average 30-year FHA mortgage APR is 7.06%. The average 30-year FHA refinance APR is 7.18%, according to Bankrate's ... latest survey of the nation's largest mortgage lenders.

Current 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 6.38% 7.06%
30-Year Fixed Rate 7.30% 7.32%
15-Year Fixed Rate 6.73% 6.76%
5/1 ARM Rate 6.17% 6.17%
30-Year VA Rate 6.68% 6.79%

Rates as of Monday, February 26, 2024 at 6:30 AM

How to find and compare FHA interest rates

With Bankrate’s FHA mortgage rate table, you can receive tailored-to-you quotes from lenders by plugging in your location and basic details about your finances. This can give you a ballpark sense of what a loan might cost you.

To get a formal FHA mortgage offer, first decide on a loan term: either 15 years or 30. A shorter term comes with a lower interest rate, reducing your overall expense, but has the downside of a higher monthly payment.

You can seek offers from a variety of lender institutions or compare offers online. Be sure to talk with your bank or any other financial institution that you have an existing relationship with, since it might offer special rates or deals to current customers. If you’re not sure where to start, check Bankrate’s picks for some of the best FHA lenders.

Lender compare

Compare mortgage lenders side by side

Mortgage rates and fees can vary widely across lenders. To help you find the right one for your needs, use this tool to compare lenders based on a variety of factors. Bankrate has reviewed and partners with these lenders, and the two lenders shown first have the highest combined Bankrate Score and customer ratings. You can use the drop downs to explore beyond these lenders and find the best option for you.

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Garden State Home Loans

NMLS: 473163

State License: MB-473163

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Rating: 3.6 stars out of 5
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Rating: 4.98 stars out of 5

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Homefinity

NMLS: 2289

State License: 4965

4.5

Rating: 4.5 stars out of 5
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Rating: 4.94 stars out of 5

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What is an FHA loan?

FHA loans are government-backed mortgages for single-family and multifamily homes. They’re offered through FHA-approved lenders and insured through the Federal Housing Administration (FHA).

FHA loans are more accessible than conventional loans in that they have a lower credit score requirement: at least a 580 if you can put 3.5 percent down as a down payment, or 500 if you can put 10 percent down. Because of this, FHA loans are popular among first-time homebuyers, borrowers on tighter budgets and those who have lower credit scores.

FHA loan requirements

  • FHA loan limits: $498,257 for a single-family home; higher in costlier counties and for multifamily homes
  • Minimum credit score: 580 with a 3.5% down payment, or 500 with a 10% down payment
  • Maximum debt-to-income (DTI) ratio: Up to 50%
  • Mortgage insurance premiums (MIP): 1.75% of your loan principal upfront; monthly premiums thereafter based on amount you borrow, down payment and loan term and type
  • Financial and work history: Proof of consistent employment and income

Read more about FHA loan requirements

FHA mortgage insurance

FHA loans require borrowers who put down less than 20 percent to pay mortgage insurance premiums (MIP). Mortgage insurance costs add a meaningful amount to your monthly payment, so keep these costs in mind when you’re budgeting for a home.

There are two types of premiums: the upfront mortgage insurance premium (1.75 percent of the base loan amount) and an annual mortgage insurance premium (0.15 percent to 0.75 percent, depending on the loan term, loan amount and the loan-to-value (LTV) ratio). The annual premium is owed for the loan’s lifetime if your down payment is less than 10 percent; if you put down at least 10 percent, however, the premiums can be removed after 11 years.

FHA loan limits

Each year, the FHA updates its lending limits, or the maximum amount the agency will insure for a given area and type of property. These limits are influenced by mortgage market-makers Fannie Mae and Freddie Mac’s conforming loan limits. For 2024, the national ceiling is $498,257 for a single-family home, and up to $1,149,825 in high-cost areas.

Pros and cons of FHA loans

Pros of FHA loans

  • Low down payment requirement
  • 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

Cons of FHA loans

  • Borrower required to pay two types of mortgage insurance: an upfront mortgage insurance premium (MIP) and an annual premium
  • Require that the house meet certain standards, which decreases buying options

FHA loan FAQ

 

Written by: Jeff Ostrowski, mortgage reporter for Bankrate

Jeff Ostrowski writes about the U.S. housing market for Bankrate. He has appeared on CNBC and numerous radio and television outlets to discuss his reporting about real estate trends.

Read more from Jeff Ostrowski