A good fit if…
- Your credit score is fair or still recovering
- You have a smaller down payment saved, or family is helping with a gift
- Your debt-to-income ratio is on the higher side
- You’re buying a home you’ll live in, up to four units
How an FHA loan works
The Federal Housing Administration doesn’t lend money. It insures the loan, which protects the lender if a borrower defaults. Because of that insurance, lenders can approve buyers who might not fit conventional guidelines: lower credit scores, smaller down payments, and higher debt-to-income ratios.
In exchange, you pay FHA mortgage insurance. There’s an upfront premium, which is usually added into the loan amount, and an annual premium that’s split into your monthly payment. Depending on your down payment, that annual premium can last for the life of the loan, which is why many FHA borrowers refinance into a conventional loan once they’ve built equity.
2026 FHA loan limits in Arizona
FHA sets a maximum loan amount by county. For 2026, the limit for a one-unit home in Maricopa and Pinal counties (the Phoenix metro) is $557,750. Most other Arizona counties sit at or near the national floor, which is a little lower. Two- to four-unit properties have higher limits.
If the home you want is priced above the FHA limit for its county, a conventional loan is usually the next thing to compare. Pete can pull the exact limit for any Arizona county in a minute.
Credit, debt and gift funds
- Credit: HUD allows credit scores as low as 500. Below 580, a larger down payment is required. Individual lenders can set higher minimums, which is one reason shopping across many lenders matters.
- Debt-to-income: FHA is more forgiving than most programs when your monthly debts are high compared to your income, especially with strong compensating factors like savings or a steady job history.
- Gifts: Your down payment can come from a family member as a documented gift.
- Seller help: Sellers can contribute toward your closing costs, up to a limit.
What the FHA appraisal looks at
An FHA appraisal checks value and also basic safety and soundness: a working roof, safe electrical, no peeling paint on older homes, and so on. Most homes pass without trouble. When something does come up, it’s usually a small repair the seller can handle before closing.
Condos: In Tempe, Scottsdale and parts of Phoenix, a lot of condo buyers run into this. The complex needs FHA approval, or the individual unit needs a single-unit approval. Ask Pete to check a condo before you write an offer.
Arizona down payment assistance with FHA
FHA pairs well with Arizona’s down payment assistance programs, including Home Plus, which is available statewide to buyers under its income limit. See the first-time buyer page for the current programs and how they work.
Run the numbers
Common questions
Can I get an FHA loan more than once?
Yes. FHA isn’t only for first-time buyers. You can generally have one FHA loan at a time on a home you live in, and there are exceptions for things like relocating for work or a growing family.
Can I get rid of FHA mortgage insurance?
Depending on your down payment, FHA’s annual premium may last for the life of the loan. The most common way out is refinancing into a conventional loan once you have enough equity. Pete can tell you when that math starts to work.
What’s the FHA loan limit in Phoenix for 2026?
For a one-unit home in Maricopa County, which includes Phoenix, the 2026 FHA limit is $557,750. Pinal County has the same limit.
Is FHA better than conventional?
It depends on your credit and down payment. FHA often wins with lower credit scores; conventional often wins with stronger credit because its mortgage insurance can be cheaper and can be removed. Pete will price both side by side.
This page is general information, not a loan offer, rate quote or commitment to lend. Program guidelines, loan limits and assistance programs change; figures shown are as of 2026. Eligibility, down payment and terms depend on your credit, income, property and the program. Ask Pete for current details.