An FHA loan is a government-insured mortgage that allows down payments as low as 3.5% and credit scores as low as 580. It’s often the best fit for Utah buyers with limited savings or rebuilding credit — though we always compare it against low-down conventional options, which can be cheaper for stronger credit profiles.
Why borrowers choose this program
- 3.5% minimum down payment (can be gifted by family)
- Credit scores from 580 (sometimes lower with compensating factors)
- Higher debt-to-income allowances than most conventional loans
- Assumable — a future buyer can take over your low rate
FHA vs. conventional: the honest comparison
FHA charges an upfront mortgage insurance premium (1.75% of the loan) plus monthly mortgage insurance that usually lasts the life of the loan. Conventional mortgage insurance costs more with lower credit scores but disappears once you reach 20% equity. Rule of thumb: below roughly 680 credit, FHA often wins; above it, conventional usually does. We run both quotes on every file rather than guessing.
FHA loan limits in Utah
FHA limits vary by county and change annually. Along the Wasatch Front (Davis, Weber, and Salt Lake counties), limits are high enough to cover most starter and mid-range homes. We’ll confirm the current limit for your target county when we pre-approve you.