An FHA loan is a mortgage insured by the Federal Housing Administration. With just 3.5% down and credit scores starting at 580, the FHA program is the most accessible path to homeownership in California's expensive housing market. Save Financial is a direct FHA-endorsed lender and CalHFA-approved partner.
How does an FHA Loan work?
| FHA loan limits | Standard counties: $533,950. High-cost California counties: up to $1,209,750 (LA, OC, SF Bay Area, San Diego). |
| Down payment | 3.5% with 580+ FICO. 10% with FICO between 500–579. |
| Credit score | 580 minimum for 3.5% down. Some lenders go to 500 with 10% down — Save Financial originates down to 580. |
| Mortgage insurance | Upfront MIP of 1.75% (financed) plus annual MIP of 0.55–0.85% depending on LTV. With 10%+ down, MIP drops off after 11 years; otherwise lasts the life of the loan. |
| DTI ratio | Up to 56.99% with compensating factors. Higher than conventional flexibility. |
| Property types | Owner-occupied 1–4 unit only. Must meet FHA minimum property standards. |
Who should consider this loan?
- First-time California homebuyers with limited down payment savings.
- Borrowers with credit scores between 580 and 680.
- Buyers recovering from a past bankruptcy (2-year wait) or foreclosure (3-year wait).
- Families buying a 2–4 unit property to house-hack with FHA's owner-occupant rules.
- Buyers planning to stack CalHFA down payment assistance.
Save Financial advantage
As a direct California mortgage lender shopping across 40+ wholesale and correspondent investors, we match your fha loan file to the program with the sharpest pricing and most flexible guidelines — not just the one our bank happens to sell.
How does an FHA loan compare to Conventional 3% Down?
| FHA | Conventional | |
|---|---|---|
| Min credit score | 580 | 620 |
| Min down payment | 3.5% | 3% (FTHB programs) |
| Mortgage insurance | Life of loan* | Drops at 78% LTV |
| Upfront cost | 1.75% UFMIP (financed) | None |
| DTI limit | Up to 56.99% | Up to 50% |
| Property condition | Strict FHA standards | Standard appraisal |
Common questions about FHA Loans
Can I get an FHA loan with a 580 credit score?
Yes. The FHA allows 3.5% down with a credit score of 580 or higher. Save Financial originates FHA loans down to 580 FICO. If your score is between 500 and 579, you can still qualify for an FHA loan but must put 10% down. Most retail banks will not go below 620 on FHA, but as a direct FHA-endorsed lender, Save Financial follows FHA's actual published guidelines.
What is the FHA loan limit in California for 2026?
The 2026 FHA loan limit varies by California county. Standard counties cap at $533,950. High-cost counties — including Los Angeles, Orange, San Francisco, San Mateo, Santa Clara, Alameda, Marin, Contra Costa, and San Diego — have an FHA ceiling of $1,209,750, the same as the high-balance conforming limit. This means FHA is viable for homes in California's most expensive markets.
How much is FHA mortgage insurance in California?
FHA charges two mortgage insurance premiums. The upfront MIP is 1.75% of the loan amount, financed into the loan. The annual MIP is 0.55% for most 30-year loans with less than 5% down, dropping to 0.50% with 5%+ down. With less than 10% down, annual MIP lasts the full loan term; with 10%+ down, it drops off after 11 years.
Can I combine an FHA loan with CalHFA down payment assistance?
Yes. Save Financial is a CalHFA-approved lender, which means qualifying California borrowers can pair an FHA first mortgage with CalHFA's MyHome Assistance Program (up to 3.5% in deferred down payment help) or the Zero Interest Program. In many cases, this combination allows California first-time buyers to purchase with effectively zero out-of-pocket down payment.
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