FHA Interest Rates: Compare Current Rates and Loan Offer

Compare FHA loan offers to get the lowest rates and save thousands

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LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
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Current FHA interest rates

Loan Product
Interest Rate
APR
30-year fixed rate FHA mortgage
6.32%
7.01%
30-year fixed rate FHA refinance
6.72%
7.47%

Average rates disclaimer Current average rates are calculated using all conditional loan offers presented to consumers nationwide by LendingTree’s network partners over the past seven days for each combination of loan type, loan program, and loan term. Rates and other loan terms are subject to lender approval and not guaranteed. Not all consumers may qualify. See LendingTree’s Terms of Use for more details.

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Are FHA loan rates lower than conventional rates?

Yes, but that doesn’t always mean that FHA loans are cheaper. To understand why, you’ll need to pay attention to each loan’s annual percentage rate (APR).

Unlike an interest rate, which only measures the cost to borrow money, an APR captures all of the costs you’ll pay when taking out a loan. FHA loans often have higher APRs than comparable conventional loans because they require you to pay for FHA mortgage insurance. That can push up your total loan costs by quite a bit.

  How do I find FHA lenders to compare rates?

LendingTree’s list of the best FHA mortgage lenders is a great place to start. You can also try a comparison rate site, or ask for a referral from a friend, relative or a real estate agent. You can look up FHA-approved lenders online through the U.S. Department of Housing and Urban Development’s lender list search tool.

Current FHA interest rate trends

Interest rates have been trending downward since late spring and it’s likely they’ll continue to drop. LendingTree’s mortgage rates forecast expects the Federal Reserve to cut rates at least once more this fall, which means that rates should move closer to 6% by the end of 2024.

How do FHA interest rates work?

FHA interest rates are typically lower than conventional loan rates. However, when you add in the cost of FHA mortgage insurance, FHA loans may end up being more expensive than comparable conventional loans. That’s why it’s important to keep an eye on the total loan costs of any mortgage you’re considering, not just the interest rates.

  How much is FHA mortgage insurance?

The exact amount you’ll pay in mortgage insurance premiums will vary based on your loan amount, loan term and loan type. For example, an FHA borrower with a $300,000 purchase loan can expect to pay $5,250 in upfront fees, and between $450 and $2,250 in annual premiums thereafter.

How to get the lowest FHA mortgage rates today

  • Shop around. Apply for loans and compare loan estimates from at least three to five different FHA-approved lenders. In addition to interest rates, focus on each lender’s closing costs, since these can be a significant expense. A lower interest rate may come with higher costs, so make sure you have extra cash to cover these fees.
  • Choose a shorter term. If you can afford a higher monthly payment, your FHA loan rate will be lower with a shorter term, like a 15-year fixed-rate mortgage instead of the more common 30-year fixed-rate mortgage. You’ll also save thousands of dollars in interest over the life of the loan by going with a 15-year loan instead of a 30-year loan.
  • Ask the seller to buy mortgage points. Paying for mortgage points buys you a lower interest rate. One full point costs 1% of your loan amount and usually reduces your rate by up to 0.25 percentage points. You can ask the seller to pay up to 6% of your home price toward closing costs (including mortgage points) to get a lower FHA interest rate. You may also be able to deduct the cost of the points when you file your taxes.
  • Boost your credit scores. Although the FHA doesn’t require a high credit score to approve you for a loan, a higher credit score can get you a lower FHA interest rate. Most FHA loan borrowers have a score between 640 and 679. If your score is significantly lower, you can improve it by paying bills on time and keeping each of your credit card balances below 30% of your available credit.

FHA interest rates by credit score

FHA loan rates change day to day, but the table below should give you an idea of how your credit score may affect the FHA loan rates you’re offered. We’ve calculated the premium () or discount () you’ll pay versus average FHA and conventional loan rates. A premium is an amount paid above a standard or basic cost, while a discount refers to the money you’ll save compared to a standard or basic cost. Here, we’ve used average FHA and conventional loan rates as the standard.

DescriptionCredit scoreFHA interest rateVs. average FHA rateVs. comparable conventional loan
Above average credit scores for an FHA loan borrower800+5.55% 0.36%0.63%
780-7995.51% 0.40% 0.69%
760-7795.58%0.33%0.70%
740-7595.61%0.30% 0.76%
720-7395.69%0.22% 0.84%
700-7195.74%0.17% 0.92%
680-6995.76%0.15% 1.02%
Average scores for an FHA loan borrower660-6795.87%0.04% 1.01%
640-6595.92% 0.01% 0.97%
Below average scores for an FHA loan borrower620-6396.03% 0.12%0.88%
250-6196.24%0.33% 1.04%

All calculations based on data from ICE Mortgage Technology.

As you can see, your credit score can greatly affect the rate you’ll pay on an FHA loan. The higher your score, the more you stand to save. However, even borrowers with below-average scores can expect interest savings by going with an FHA loan instead of a comparable conventional loan.

  For the most up-to-date FHA rates, jump back to the top of this page or gather lender quotes online.

Pros and cons of FHA loans

ProsCons

 Lower interest rates. You'll likely find that FHA loan rates are lower than rates on conventional loans.

 Lower credit score minimum. You can qualify with a credit score as low as 500.

 Small down payment requirement. You can qualify with as little as 3.5% down.

 Less paperwork. You may qualify for FHA streamline refinance options that don’t require income verification or a home appraisal.

 Higher total costs. Your APR may be higher compared to a similar conventional loan, due to FHA mortgage insurance.

 Higher monthly payments. Your monthly payment may be higher — even if your rate is lower — due to mortgage insurance charges.

 Higher risk. You may end up with a higher-priced mortgage loan, which is more likely to become unaffordable over time.

How to qualify for an FHA loan

You’ll need to meet the minimum requirements below to be approved for an FHA loan.

Down payment3.5% with a 580 credit score
10% with a 500 to 579 credit score
Credit score580 with a 3.5% down payment
500 to 579 with a 10% down payment
Debt-to-income (DTI) ratio43%, with exceptions up to 50%
OccupancyMust live in the home as your primary residence
EmploymentStable two-year employment history, no income limits
AssetsDown payment can be gifted by an employer, relative, close friend or charitable organization
Loan limits$498,257 for a one-unit home in most parts of the country; higher FHA loan limits may be available in high-cost areas. Use the tool below to look up the limit in your area.

Frequently asked questions

Yes, you can get an FHA loan on a manufactured home — as long as it was built after 1976 and meets other FHA guidelines. The FHA offers two loan programs for manufactured homes, known as Title I and Title II loans.

You may not qualify for an FHA loan if you have a credit score below 500, you’re carrying too much debt already or you can’t save at least a 3.5% down payment. In addition, you’ll need to meet a slew of FHA requirements related to your financial picture, employment history and your future home itself.

Current FHA loan rates for a borrower with a 700 credit score are around 5.74%. Rates change daily but, for comparison, that’s 92 basis points lower than the current average conventional loan interest rate. Have a look at the chart above to explore how different credit scores affect FHA loan rates.

Yes. A variety of FHA adjustable-rate mortgages (ARMs) are available with introductory fixed-rate periods of one, three, five, seven or 10 years. Once the initial fixed-rate period ends, the rate will adjust, meaning your monthly payment will likely fluctuate for the remainder of the loan term.

If you can’t qualify for a conventional loan because your credit score is too low, it makes sense to look into an FHA loan. However, if you can avoid expensive FHA mortgage insurance, you likely should consider a conventional loan.

There are many low-down-payment loan programs available to conventional borrowers, especially if you’re a first-time homebuyer. You can also look into down payment assistance programs.

FHA mortgage insurance is mandatory for the life of an FHA loan with a 3.5% down payment. With at least a 10% down payment, you’ll pay the premiums for 11 years. To get rid of these payments sooner, you can refinance to a conventional mortgage.