FHA Loan Requirements in California

Thinking about using an FHA loan to buy a home in California? Good move — they’re popular for a reason. Lower down payments, easier credit rules, and government backing make them a solid option. But there are conditions you’ve got to meet. Let’s go through them.

Credit Score Stuff

Your credit score decides what kind of deal you can get.

• If it’s 580 or higher, you’re in good shape — just 3.5% down.
• Between 500 and 579? It gets trickier. You’ll likely need to put down at least 10%.
• One thing though — lenders might want a higher score, even if FHA says 580 is okay. So it really depends on who you’re working with.

What About the Down Payment?

It ties right back to your credit.

• Score 580+? You’re looking at 3.5% down.
• Score under that? It jumps to 10%.
• Some folks use gift funds (from family, usually), or down payment help programs. Both are allowed, but check that they’re approved.

Debt and Income (a.k.a. Can You Afford the Loan?)

FHA lenders want to make sure you’re not stretched too thin.

• They’ll look at your debt-to-income ratio, or DTI. That’s how much of your income goes to bills and loans.
• 43% is the general limit, but some lenders go a little higher. Still, staying under 43% is safer.

Income and Job History

Here’s where you show you’ve got steady cash coming in.

• Lenders usually want to see two years at the same job or field.
• You’ll need pay stubs, W-2s, or tax returns.
• Self-employed? It’s doable, but expect to show more paperwork (like 1099s, full tax filings, etc.)

What Kind of Property Can You Buy?

Not just any home qualifies.

• The place has to be your main home. No second homes or rentals.
• The house needs to pass an FHA appraisal, which involves checking things like heat, plumbing, roof, safety stuff.
• If the place has major issues, you may have to fix them before getting approved.

Mortgage Insurance (Yep, It’s Required)

FHA loans always come with mortgage insurance. That’s how they keep risk low for lenders.

• There’s an upfront fee (1.75% of the loan) — you pay it when the loan starts, or roll it into the loan.
• Then there’s a monthly insurance fee. That keeps going for a while.
• If you put 10% down, you might be able to cancel the monthly part after 11 years.

Loan Limits in California

FHA loans don’t let you borrow unlimited amounts. There’s a cap based on where you’re buying.

• In cheaper counties, the limit is about $524,000.
• In pricey spots like L.A. or San Francisco, it goes over $1.2 million.
• These limits change every year. Always look up your county before house hunting.

Real Talk: What You Need to Get Approved

Let’s cut to the chase. You’ll need:

• A credit score of at least 580 (or 500 with more money down)
• Steady income and a job history
• Enough for 3.5% or 10% down, depending on credit
• A house that meets FHA’s safety standards
• Monthly income that supports the loan without overloading your budget
• Mortgage insurance (no way around it)

Final Thought

FHA loans help a lot of people buy homes — especially in a state like California, where prices are high and saving up 20% down isn’t always realistic. But even though the rules are more flexible than other loans, you still have to meet the key points.

It’s worth talking to a local FHA lender. They’ll tell you exactly where you stand, what’s possible, and what to do next. Rules are one thing — but guidance helps even more.