What's an FHA loan?

FHA loans are mortgages insured by the Federal Housing Administration, designed to make homeownership accessible to buyers with lower credit scores or smaller down payments. The headline numbers: 3.5% down with a credit score of 580 or higher (or 10% down with 500-579), more flexible debt-to-income limits than conventional (often up to 50%), and easier approval if you've had past credit issues. The trade-off is mortgage insurance: FHA charges an upfront MIP of 1.75% (rolled into the loan) plus an annual MIP of 0.55% spread across your monthly payments, and on most FHA loans that monthly MIP stays for the life of the loan unless you refinance into a conventional. So FHA is often the right call to get into the home, with a plan to refinance into a conventional once you have 20% equity and a stronger score. Loan limits in most Washington counties are around $524,225 for a single-family home, and higher in King, Pierce, and Snohomish counties.