What FHA loans require for a down payment in 2026

An FHA loan is a mortgage insured by the Federal Housing Administration, and it requires a minimum down payment of 3.5 percent of the home's purchase price. This is the standard floor set by the FHA itself — no FHA loan will go through with less. If you are buying a $200,000 home, your minimum down payment would be $7,000. The remaining amount you borrow comes as the mortgage itself.

The 3.5 percent figure has remained stable for years and is not changing for 2026. What does change year to year is the maximum loan amount the FHA will insure, which varies by county and is adjusted each January. Your lender will tell you the limit for your specific county when you start the process — it affects how much you can borrow, not how much you must put down.

One important detail: the 3.5 percent down payment must come from your own funds or from a gift. It cannot be borrowed. If you do not have $7,000 saved for a $200,000 home, you will need to either save more, look at less expensive properties, or explore whether a gift from a family member is possible.

Key Takeaways

  • FHA loans require a minimum 3.5 percent down payment, which has not changed and will not change in 2026.
  • Your down payment must come from your own savings or a gift — you cannot borrow it from another source.
  • The FHA charges mortgage insurance (called UFMIP and annual MIP) on top of your loan, which adds to your monthly payment and total cost.
  • Maximum loan amounts by county adjust each January, so the total you can borrow depends on where you are buying.
  • Some lenders may require more than 3.5 percent down, so comparing offers matters even though the FHA floor is fixed.

How the 3.5 percent down payment works in practice

When you find a home and make an offer, the purchase price becomes the number everything else is calculated from. If the home is $250,000 and you put down 3.5 percent, you are putting down $8,750. The lender then finances the remaining $241,250 as your mortgage.

That $8,750 comes out of your bank account before closing. The lender will ask you to show proof of where the money came from — bank statements, usually — to confirm it is genuinely yours and not a loan. If a family member is giving you the money as a gift, they will need to sign a gift letter stating it does not need to be repaid. The lender keeps this letter in the file.

The down payment itself is separate from closing costs, which are additional fees for the appraisal, title search, inspection, and lender fees. Closing costs typically run 2 to 5 percent of the loan amount and are paid at closing. You need to have both the down payment and closing costs ready, or you need to negotiate with the seller to cover some closing costs as part of the purchase agreement.

Mortgage insurance adds to your total cost

Because you are putting down only 3.5 percent, the FHA requires you to pay mortgage insurance. This protects the lender if you stop paying. Mortgage insurance comes in two forms: an upfront payment at closing and a monthly charge added to your mortgage payment.

The upfront mortgage insurance premium (UFMIP) is typically 1.75 percent of the loan amount. On a $241,250 loan, that is about $4,222. This amount is usually rolled into your loan, meaning you borrow it rather than paying it in cash at closing. Your monthly payment then includes an annual mortgage insurance premium (MIP), which varies based on your loan amount and the length of your loan, but typically ranges from 0.55 to 0.80 percent of the loan per year.

This insurance stays on your loan for the life of the loan if you put down less than 10 percent — which you are doing at 3.5 percent. If you had put down 10 percent or more, the insurance would drop off after 11 years. This is one reason some borrowers choose to save longer and put down more than the minimum.

Comparing FHA loans to conventional loans

A conventional loan — one not insured by the FHA — typically requires 5 to 20 percent down. At 5 percent down on that same $250,000 home, you would put down $12,500 instead of $8,750. Conventional loans also require mortgage insurance if you put down less than 20 percent, but the insurance usually drops off once you reach 20 percent equity in the home, which happens faster than with FHA loans.

The trade-off is that FHA loans are easier to get approved for if your credit score is lower or your debt-to-income ratio is higher. The FHA accepts credit scores as low as 580 (some lenders go lower), while conventional lenders often want 620 or higher. If you have limited savings and a less-than-perfect credit history, an FHA loan at 3.5 percent down may be your only path to homeownership right now.

Run the numbers with a lender for both FHA and conventional options. The lower down payment on an FHA loan might be offset by higher insurance costs, or it might still come out ahead depending on your situation. There is no single right answer — it depends on how much you have saved, your credit profile, and how long you plan to stay in the home.

What happens if you cannot save 3.5 percent

If you do not have 3.5 percent saved, you have a few paths. The most direct is to keep saving until you do. Even if it takes another year, you will have a larger down payment and lower monthly payments as a result.

A second option is to ask a family member for a gift. The gift must be documented with a signed letter, and the giver cannot expect repayment. Some first-time homebuyer programs also allow gifts from employers, nonprofits, or government agencies — ask your lender whether any explore to you.

A third option is to look at less expensive homes in your area. A $180,000 home requires only $6,300 down instead of $8,750. This may mean a different neighborhood or a smaller property, but it could get you into homeownership sooner.

If none of these work, you may not be ready for homeownership yet. That is not a failure — it is honest planning. Buying a home you cannot afford down the road costs far more than waiting.

County loan limits and how they affect your borrowing

The FHA sets a maximum loan amount for each county, adjusted each January. In 2026, these limits will be higher than 2025, but the exact amount depends on where you are buying. A county in a high-cost area like San Francisco may have a limit of $1.1 million or more, while a rural county might have a limit of $420,000.

The loan limit matters because it caps how much you can borrow, regardless of your income or credit. If the maximum FHA loan in your county is $420,000 and you want to buy a $500,000 home, you cannot use an FHA loan — you would need a conventional loan or to put down more than 3.5 percent out of pocket.

Your lender will look up the limit for your county as soon as you start the process. They will tell you the maximum home price you can buy with an FHA loan. If you are shopping in a high-cost area, this limit may not affect you. If you are in a lower-cost area, it might.

Frequently Asked Questions

Can I borrow the 3.5 percent down payment from someone?

No. The down payment must come from your own funds or from a gift that does not need to be repaid. If you borrow it, the lender will count that borrowed money as a debt when calculating whether you can afford the mortgage. This usually makes the loan harder to get approved for or impossible to get approved for at all.

What if my lender wants more than 3.5 percent down?

Some lenders set their own minimums above the FHA floor. If one lender asks for 5 percent, shop around — other lenders may accept 3.5 percent. Lenders have different risk tolerances, especially based on credit score and debt levels. Getting multiple offers is worth the time.

Does the down payment amount change if I have a lower credit score?

The FHA minimum stays at 3.5 percent regardless of credit score. However, a lower credit score may make it harder to find a lender willing to do the loan, or the lender may charge a higher interest rate. The down payment itself does not move, but your overall cost will be higher.

Will the 3.5 percent requirement change in 2026?

No. The FHA has kept the minimum down payment at 3.5 percent for many years, and there is no indication it will change in 2026. What does change annually is the maximum loan amount by county, which the FHA adjusts each January based on home prices in that area.

Can I put down more than 3.5 percent to avoid mortgage insurance?

You can put down more, but you still pay mortgage insurance on FHA loans unless you put down 10 percent or more. At 10 percent down, the insurance drops off after 11 years. At 20 percent or higher, there is no mortgage insurance at all. If you have the savings, putting down 10 percent or more can save you money over time.