FHA Home Loans
With low down payment options and less stringent requirements, FHA home loans can make buying or refinancing a home easier. Whether you’re purchasing your first home, taking advantage of a streamline refinance or tapping into your equity with a cash-out refinance, an FHA loan may be the perfect option to suit your needs.
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An FHA Home Loan May Be a Great Fit if You:
An FHA Home Loan May Be a Great Fit if You:
- Want to buy a home with very little down
- Need more flexible credit and income requirements
- Have an existing FHA loan and hope to lower your rate
- Are looking for a cash-out option that’s easier to qualify for
See What an FHA Home Loan Can Do for You:
See What an FHA Home Loan Can Do for You:
Get easier approval with broader credit and income guidelines 
Take advantage of low down payment options starting at 3.5% 
Lower your rate with a streamline refinance 
Access your home equity through a cash-out refinance Today's FHA
Loan Rates
A Pennymac Loan Expert can help you find the best rate and loan type to suit your goals.
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For a rate quote, please call a Pennymac Loan Officer at (866) 549-3583.
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Please keep in mind that the mortgage rates shown above are based on certain assumptions, which may differ from your personal home loan scenario. Rates valid on: and are subject to change without notice. Discount points apply, view assumptions for details.
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Try It NowTypes of FHA Home Loans
FHA Purchase Loan
- Lets you buy a home loan with as little as 3.5% down
- Allows a broader range of income, debt and credit history than conventional mortgages
- Gives you access to the FHA streamline refinance program down the road
First-time homebuyers, with smaller down payment options and more flexible qualification criteria.
FHA Streamline Refinance
- Refinance your FHA loan to lower your rate or switch to a fixed-rate mortgage
- Keep your current loan term (if desired)
- Provide minimal income and credit documentation
- Skip the appraisal
- Access low- or no-upfront-cost options
Borrowers with existing FHA loans who want to save time and paperwork to lower their rate and payment or switch from an adjustable-rate mortgage to a fixed-rate home loan.
By refinancing your existing loan, your total finance charges may be higher over the life of the loan.
FHA Cash-Out Refinance
- Tap into your home’s equity for cash to use as needed
- Pay off high-interest debt, like credit cards
- Fund value-adding home improvements
- Access FHA cash-out benefits, even if your current mortgage isn't an FHA loan
- Borrow up to 80% of the value of your home*
Homeowners who have owned and occupied their home for at least 12 months and want to take cash out of their home equity to pay off debt, fund an education, make home improvements or cover other large expenses.
Frequently asked questions
An FHA home loan is a mortgage insured by the Federal Housing Administration that can be a great option for buyers who wish to put down less than 20 percent. An FHA loan generally has more flexible income and debt requirements than some other loan products, making it a popular mortgage for first-time homebuyers.
In addition to purchase loans, FHA provides other options for homeowners. An FHA streamline refinance is designed for borrowers with existing FHA loans who want to lower their payments and requires minimal paperwork. An FHA cash-out refinance allows qualified homeowners to tap into their home equity for cash needs or major expenses.
To qualify for an FHA Purchase Loan, borrowers must be able to make a down payment of at least 3.5% (which can be from a gift), live in the property they are purchasing and have a debt-to-income ratio no higher than 50-55% (depending on their credit history). While good credit is typically required, borrowers with credit scores as low as 580 may still qualify if they have demonstrated financial responsibility in recent years.
If you already have an FHA loan, you may also be eligible for an FHA streamline refinance to reduce your monthly payments with minimal paperwork. Or you can choose cash-out refinancing to access home equity for debt, home improvements or other expenses.
Our dedicated Pennymac Loan Experts have proudly earned a reputation for focusing on the unique needs of every homebuyer they work with. They are at the core of our national leadership in the mortgage industry.
Whether you are a first-time homebuyer exploring an FHA mortgage or seeking to refinance an existing FHA loan, our specialists can guide you through every step of the FHA mortgage process.
Interested to learn more about what Pennymac can do for you? Get your own customized rate today.
In exchange for more flexible qualifications, FHA loans have a mandatory mortgage insurance fee that helps safeguard lenders on FHA loans. There are two components:
- Upfront Mortgage Insurance Premium (UFMIP): A one-time fee paid at closing, typically 1.75% of the loan amount. For example, a $200,000 FHA loan would have a $3,500 UFMIP. In many cases, lenders can roll the costs of UFMIP into the loan. This can help borrowers reduce their out-of-pocket costs at the close of the loan.
- Monthly Mortgage Insurance Premium (MIP): This is paid monthly as part of your mortgage payment. The amount varies based on loan size, term and down payment, but is generally less than 1% of the loan amount per year (paid monthly).
If you have an FHA loan, you may opt to refinance into a conventional mortgage later on down the road. With sufficient equity, that move can allow you to reduce or eliminate your mortgage insurance entirely. Once you reach an 80% LTV with a conventional loan, your mortgage insurance can be removed as long as you are current on payments.
Tip: Use our home loan calculator to estimate your monthly payment, including taxes and insurance estimates, to get a clearer picture.
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*The Scotsman Guide for #1 FHA Lender was awarded for the first half of 2025, according to Inside Mortgage Finance
