How do FHA loans work in Houston?

FHA is the loan most first-time buyers in Houston ask us about. Here is what you need to know before you talk to a loan officer. Disponible en español; solo pregunte.

What is an FHA loan?

A regular home loan from a lender, with the government standing behind it. That backing is why lenders can accept a smaller down payment and a lower credit score.

Source: U.S. Department of Housing and Urban Development, Handbook 4000.1 (2026).

How much do you need down?

3.5% of the price with a credit score of 580 or higher. Below 580, it is 10%.

The money can come from your savings, a gift from family, or a down payment assistance program. Houston and Texas both offer assistance programs, and a loan officer can tell you which ones you may qualify for.

What does it cost?

FHA loans include mortgage insurance. One charge of 1.75% is added to your loan at closing, and a yearly charge of 0.55% is built into your monthly payment.

With less than 10% down, the monthly charge stays for the life of the loan. Many Houston homeowners refinance into a conventional loan later to remove it. A loan officer can show you the full monthly payment before you decide.

Source: HUD Mortgagee Letter 2023-05 and Handbook 4000.1. Charges are set by HUD and can change.

What is the loan limit in Harris County?

$541,287 for a single-family home in 2026. Homes with two to four units have higher limits.

Source: HUD, FHA Mortgage Limits, calendar year 2026, Harris County, Texas.

What kind of home qualifies?

A home you will live in, with up to four units, that passes a basic safety check during the appraisal.

You need to move in within 60 days of closing. If you buy a duplex, triplex, or fourplex and live in one unit, the rent from the others can help you qualify.

Is FHA or conventional better for you?

FHA usually costs less per month for credit scores in the 600s. Conventional usually costs less for scores in the 700s.

The way to know for sure is to have a loan officer run both on the same home and show you the two payments side by side. It takes a few minutes. We also compare them in FHA vs conventional in Texas.

What is the next step?

A short conversation about your credit, income, and savings, in English or Spanish.

Warens Financial Group is a Houston mortgage broker, so we compare FHA offers from several lenders for you. Read more on our FHA loans page, or start the conversation below.

Frequently asked questions

What credit score do you need for an FHA loan in Houston?

580 for the 3.5% down payment option. With a score between 500 and 579 you need 10% down. Some lenders set their own minimum a little higher, so ask.

Can I use down payment assistance with an FHA loan?

Often, yes. Houston and Texas both run assistance programs that pair with FHA loans. A loan officer can tell you which ones you may qualify for.

Does the monthly mortgage insurance ever go away?

With less than 10% down, it stays for the life of the loan. With 10% or more down, it drops off after 11 years. Many homeowners refinance later to remove it.

Can I get an FHA loan after a bankruptcy or foreclosure?

Yes, after a waiting period, generally two years after a bankruptcy and three years after a foreclosure. A loan officer can tell you where you stand.

Disclaimer: This article is for general educational purposes only and is not financial or legal advice, a commitment to lend, or an offer of credit. FHA guidelines, loan limits, and premiums are set by HUD and change over time, individual lenders may apply stricter requirements, and approval depends on the full application. Warens Financial Group, NMLS #2532048. Equal Housing Opportunity. Warens Financial Group, NMLS #2532048. Franklin Warens, Mortgage Broker, NMLS #1249423. Equal Housing Opportunity.