What is an FHA loan?
An FHA loan is a mortgage insured by the Federal Housing Administration. Because the government backs the loan, lenders can offer easier qualifying terms than a standard conventional mortgage — lower down payments, more forgiving credit requirements, and flexibility on past financial hiccups. It's the go-to option for many first-time and lower-credit buyers in Cleveland.
FHA loan requirements
3.5% down payment
With a credit score of 580+. Down payment can come from gifts or assistance programs.
580+ credit score
Scores of 500–579 may still qualify with 10% down. Lenders may set their own overlays.
Steady income & DTI
Generally a debt-to-income ratio up to ~43–50% with compensating factors.
Primary residence
FHA is for owner-occupied homes — you must live in the property.
2026 FHA loan limits in Cuyahoga County
Single-family FHA limit
Cuyahoga County follows the standard FHA "floor" that applies to most of Ohio. Limits are higher for 2–4 unit properties and are updated by HUD each year.
*2025 one-unit floor shown; 2026 figures are released by HUD annually — we'll confirm the current limit on your quote.
Mortgage insurance (MIP), explained
Every FHA loan carries mortgage insurance, which protects the lender. There are two pieces:
- Upfront MIP — typically 1.75% of the loan, usually rolled into the loan balance.
- Annual MIP — paid monthly; the rate depends on your loan term and down payment.
If you put less than 10% down, MIP generally stays for the life of the loan — many buyers later refinance into a conventional loan to drop it once they have 20% equity. Ask us to run the numbers on both.
FHA vs. conventional
| FHA | Conventional | |
|---|---|---|
| Min down | 3.5% | 3% (first-time) |
| Min credit | 580 (500 w/ 10%) | ~620 |
| Mortgage insurance | Upfront + monthly MIP | PMI, drops at 20% equity |
| Best for | Lower credit / savings | Stronger credit |
Not sure which fits? Compare both on our first-time homebuyer guide, or just start a quote and we'll show you side by side.
Compare FHA lenders in Cleveland
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FHA loan FAQ
Absolutely — FHA is one of the most popular first-time buyer options, and you can stack it with OHFA down payment assistance to lower your cash to close even further.
Yes. FHA allows 100% of your 3.5% down payment to come from a documented gift from family, or from a down payment assistance program.
With less than 10% down, MIP typically lasts the life of the loan. Many homeowners refinance to a conventional loan to remove it once they reach 20% equity.
A primary residence with 1–4 units (you must live in one). The home must meet FHA's minimum property standards, checked during the appraisal.
FHA Loans Explained
Learn about FHA loans, including requirements, down payment minimums, and who they're best for.