Current FHA guidelines, updated from one source.
This snapshot carries the FHA purchase parameters: the minimum required investment, the decision score that opens maximum financing, the upfront and annual mortgage insurance, and the manual qualifying ratios, each read from Lendmire’s guideline source.
Up to 96.5% loan-to-value on a purchase
3.5% of the purchase price or appraised value, whichever is lower, is the minimum investment on an FHA purchase; the loan covers the rest, up to 96.5% loan-to-value, and a gift may cover the whole investment.
Decision score for maximum financing
A decision score of 580 or higher is eligible for maximum financing; HUD’s rules allow lower scores at reduced leverage, but the wholesale programs Lendmire places FHA loans with start at 580, so that is the working floor.
Plus 0.50%–0.55% a year on most thirty-year loans
1.75% upfront plus 0.50%–0.55% a year on most thirty-year loans is the price of the leverage; larger base loans carry a higher annual tier, fifteen-year loans a lower one, and the calculator applies HUD’s schedule to the figures you enter.
Housing and total debt, manual reference
Housing and total debt ratios of 31/43 need no compensating factors; higher ratios are approvable with the factors in the ladder below, and files scored by HUD’s automated system follow the system’s finding rather than the manual table.
| Decision score | Housing / total | Compensating factors |
|---|---|---|
| 500–579 or no credit score | 31% / 43% | not applicable — ratios may not exceed 31/43 (energy efficient homes 33/45) |
| 580 and above | 31% / 43% | no compensating factors required (energy efficient homes 33/45) |
| 580 and above | 37% / 47% | one of: verified and documented cash reserves; minimal increase in housing payment; residual income |
| 580 and above | 40% / 40% | no discretionary debt |
| 580 and above | 40% / 50% | two of: verified cash reserves; minimal increase in housing payment; significant additional income not reflected in effective income; residual income |
| Base loan | Leverage | Annual premium | Duration |
|---|---|---|---|
| Standard base loan amounts | at or below 90% LTV | 0.50% | 11 years |
| Standard base loan amounts | above 90% to 95% LTV | 0.50% | mortgage term |
| Standard base loan amounts | above 95% LTV | 0.55% | mortgage term |
| Larger base loan amounts | at or below 90% LTV | 0.70% | 11 years |
| Larger base loan amounts | above 90% to 95% LTV | 0.70% | mortgage term |
| Larger base loan amounts | above 95% LTV | 0.75% | mortgage term |
Refinances: rate-and-term to 97.75% loan-to-value on a home occupied for the past year; cash-out to 80% after twelve months of ownership and occupancy; streamline refinances of an existing FHA loan without an appraisal. Sellers and other interested parties may contribute up to 6% of the price toward closing costs; the entire minimum investment may be a gift.
Current FHA snapshot · updated October 1, 2026 · owner-occupied principal residences, one to four units · county loan limits apply — ask a Lendmire loan officer for the limit where you are buying · FHA loans are assumable · Lendmire is not affiliated with FHA or HUD.
Program guidelines only, not an offer of credit. The minimum investment, decision-score tiers, mortgage insurance premiums, qualifying ratios, and refinance leverage on this page are FHA parameters and lender overlays subject to change without notice and to full underwriting of the borrower and the property. Nothing here states a rate, a payment, a cost, or a loan limit; those are provided in writing by a licensed Lendmire loan officer. Licensed for consumer mortgage lending in sixteen states. Lendmire is not affiliated with FHA, HUD, or the federal government. Lendmire, LLC, NMLS #2371349. Equal Housing Opportunity.
What an FHA loan is — and how the file is qualified.
The mechanics are the same on every Raleigh FHA file: the buyer brings the minimum investment, the decision score sets the leverage, the premiums insure the loan, and the ratios decide what payment the income supports. Here is how each one works.
For the program overview, see Lendmire’s FHA loan program, or the statewide guide at FHA Loans in North Carolina.
The minimum required investment
HUD requires the buyer to invest a set share of the lesser of the price and the appraised value; the loan covers the rest. On a Raleigh purchase the investment can be the buyer’s own savings, a gift from a family member or another acceptable donor, or approved secondary financing, and closing costs are separate from it.
The decision score sets the leverage
The score threshold opens maximum financing, but the file is read as a whole: payment history, seasoning after any bankruptcy or foreclosure, and the reasons behind a derogatory event. A Raleigh buyer with a recovered profile is the program’s intended borrower.
Two premiums: upfront and annual
The annual premium is where FHA and conventional diverge most: private mortgage insurance on a conventional loan cancels as equity grows, while the FHA annual premium on a full-leverage thirty-year loan lasts for the term. A Raleigh buyer who expects to refinance out of FHA later treats the premium as a bridge.
Qualifying ratios and compensating factors
Effective income is the income the lender can document as stable and likely to continue, and the ratios are measured against it. A Raleigh buyer with a modest score is held to the base ratios; above the maximum-financing score the compensating factors open the higher tiers.
This is the same arithmetic the lender runs on a Raleigh file. The moving parts are the price, which the appraisal may lower, the down payment, which can be a gift, and the rate, which the lender sets at lock; the premium schedule does not move.
Where Raleigh’s first-time and moderate-income buyers shop — and how FHA fits.
An FHA purchase is only as large as the income supports and the county limit allows, and both are set by the Raleigh market. These Census figures sketch the market that frames every file.
Market context only. Household income matters for the ratios, value for the investment and the premium, and the county limit for the ceiling; the Census tells you the market, the file tells you the loan.
Data sources: U.S. Census Bureau — ACS 5-Year (2024) housing and population estimates, including tenure, home values, gross rents, and household income.
Distinct Raleigh neighborhoods, distinct FHA files.
The six Raleigh submarkets below show where FHA buyers shop and what a file there turns on: the property type the appraiser sees, the approval it needs, and the price the ratios have to carry.
Two-to-four-unit homes
Small multi-unit homes are a Raleigh specialty, and the program takes them with a higher county limit and HUD’s rules for counting the rent. The buyer’s occupancy of one unit is the condition that makes it an FHA file. Median household income in Raleigh sits near $85,395 on the latest Census estimate.
Condominiums and townhomes
A Raleigh townhome or condominium is a routine FHA file once the project question is answered. Approved projects and single-unit approvals both work; a project with neither sends the buyer to a conventional loan. Roughly 103,241 Raleigh households own their homes on the latest Census estimate — 51% of all households, the pool an FHA purchase joins.
Newer infill and recent construction
Newer Raleigh homes rarely draw repair findings, so the file turns on the loan amount against the county limit and on the ratios at the higher price. A loan officer confirms the limit before the contract is written. The median owner-occupied home value in Raleigh runs near $415,800 on the latest Census estimate.
Established close-in neighborhoods
The Raleigh neighborhoods closest to the core hold the oldest housing stock, and the FHA appraisal reads condition as well as value there: peeling paint, aging roofs, and missing handrails bring required repairs, usually settled by the seller before closing. Raleigh counts a population near 481K within the Raleigh-Cary, NC area.
Historic districts
Older Raleigh homes being restored carry two questions on an FHA file: the condition the appraiser finds today, and whether the work needed to meet HUD’s standards can be done before closing or through an escrow. About 49% of Raleigh’s households rent — roughly 100,202 renter households on the latest Census estimate.
Higher-value homes
A high-value Raleigh purchase can still be an FHA file when the loan amount fits under the county limit; above it, the program’s leverage is not available and the comparison with conventional financing decides. On a home at Raleigh’s median value, the FHA minimum investment comes to about $14,600 — the cash the program asks a buyer to bring before closing costs.
Whatever the neighborhood, the program rules are the same: the price is checked against the appraisal, the property against HUD’s minimum property requirements, the condominium against project approval, and the file against the decision score and the ratios. Second homes and investment property are outside the program.
Four ways Raleigh buyers put an FHA loan to work.
A good use of FHA is one the program’s shape fits: a modest investment, a forgiving score, ratios with room to stretch, and insurance that makes the leverage possible. Four common Raleigh uses follow.
Refinance an existing FHA loan
An existing FHA loan in Raleigh can be refinanced on its own record: the streamline path skips the appraisal and most of the documentation, and the rate-and-term path with an appraisal reaches higher leverage when cash to close or equity matters.
Buy a first home with the minimum investment
A Raleigh buyer with the income for the payment but not the cash for a conventional down payment uses FHA to purchase with the minimum investment and keeps the rest of the savings for moving costs and reserves.
Buy a condominium in an approved project
A Raleigh condominium is an FHA purchase when the project holds HUD approval or the unit qualifies for single-unit approval; the association’s dues enter the ratios, and the appraisal addresses the project as well as the unit.
Take cash out of a home with equity
Cash-out on FHA is a full refinance of the first mortgage at the program’s cash-out leverage after a year of ownership and occupancy. A Raleigh owner weighs it against a home equity line, which keeps the existing first mortgage in place.
Estimate the FHA payment on a Raleigh price before requesting a quote.
The calculator applies HUD’s structure to a Raleigh scenario: enter the price and the down payment, pick the term, and it returns the base loan, the upfront premium financed, the total loan, principal and interest, the monthly premium for that leverage and loan size, taxes and insurance, and the ratios if you enter income. The rate field carries the weekly Freddie Mac benchmark as a market reference, not a quote.
Raleigh FHA payment estimate
Starting assumptions reflect a typical Raleigh price and the FHA minimum investment. Replace them with your own figures.
Editable benchmark: 7.03% as of September 24, 2026 · Freddie Mac 30-year average via FRED®. A conventional market reference, not an FHA loan quote.
Illustrative starting assumptions: a $415,000 price near Raleigh’s median owner-occupied home value (kept where an FHA loan is realistic in most counties), the FHA minimum investment as the down payment, a thirty-year term at the current Freddie Mac benchmark, property taxes and insurance estimated for North Carolina (U.S. Census Bureau). Every field is editable.
Illustrative estimate only — not a Loan Estimate, approval, quote, or commitment to lend. The rate field carries the weekly Freddie Mac thirty-year conventional benchmark, a market reference and not an FHA loan quote; your rate is set by the lender at lock. FHA mortgage insurance follows HUD’s published schedule for the term, leverage and loan size entered; taxes, insurance and dues are editable estimates; closing costs are not included; county loan limits are not checked here. Licensed in sixteen states for consumer mortgages. Lendmire is not affiliated with or acting on behalf of FHA, HUD, or the federal government.
Same buyer, three very different closings.
The same buyer can often close three ways, and the structures differ more than the headlines suggest: FHA with its insurance schedule, a conventional loan with private mortgage insurance that cancels, or a VA loan for an eligible borrower with no mortgage insurance at all.
FHA, conventional with mortgage insurance, or VA.
FHA fits the Raleigh buyer whose profile a conventional file would turn away or price heavily: the leverage is high, the score threshold is low, and the premiums do not rise with a weaker score. The cost is insurance that stays for the term at full leverage.
Conventional financing asks for a higher score and prices it, in exchange for insurance that can be cancelled and no upfront premium. The comparison is worth running for any Raleigh buyer whose score sits above the agency norms. See Lendmire’s conventional loan program.
VA undercuts FHA for the eligible borrower on the recurring costs: no investment, no monthly premium, no upfront premium, with a one-time funding fee in their place. The questions are eligibility, entitlement, and whether the home meets VA’s property standards. See Lendmire’s VA loan program.
The decision is rarely close once the profile is known. FHA tends to fit the modest score, conventional the strong score with equity to come, and VA nearly any file with eligibility. The comparison is run on the actual numbers, in writing.
What to prepare for a Raleigh scenario review.
An FHA file is documented more fully than a streamline refinance; the items below are what a Raleigh scenario review typically draws on.
This is a general preparation guide, not a universal checklist. The selected lender may request additional information based on the transaction, the property, the credit profile, and the income picture. Nothing here is legal or tax advice.
Local details that can change the loan.
The program’s percentages are only part of the answer; these are the details that decide what a Raleigh FHA file actually becomes once the appraisal and the credit report arrive.
Use these checks to keep the Raleigh file clean and fundable.
A clean Raleigh file answers three questions in advance: what decision score, what premium schedule, and whether the property is inside HUD’s rules and the county limit.
- Confirm the score: a self-pulled score can land differently from the decision score.
- Know the premium: ten percent down or more ends it after eleven years.
- Match the occupancy: at least one borrower occupies the home within two months and for at least a year.
The decision score decides the leverage
Two borrowers, two sets of scores, one decision score: the lowest of the middle scores. A Raleigh couple with one weak file is read on that file, which is why the score is confirmed from the lender’s report before anything is sized or any offer is written.
How long the annual premium runs
Unlike private mortgage insurance, the FHA annual premium does not cancel as the home gains value. On a Raleigh full-leverage loan the exit is a refinance; the calculator shows the premium’s rate and duration for the leverage entered.
Occupancy and the non-occupying co-borrower
Second homes and rentals are outside the program. A Raleigh buyer who will not live in the home cannot use FHA for it; a family member who will not live there can still co-sign, with full leverage preserved on a one-unit purchase.
Ratios, compensating factors, and effective income
The ratios are measured on effective income, the income the lender can document as stable and likely to continue. A Raleigh buyer above the base ratios needs a documented compensating factor, and a buyer below the maximum-financing score is held to the base table with no stretch.
Two- to four-unit homes and rental income
The multi-unit Raleigh purchase is an FHA specialty, with two things to plan: the buyer must occupy one unit, and the rental income from the others is documented and counted the way HUD allows, which is less than the full rent.
From a Raleigh pre-approval to keys in hand.
An FHA file moves in a set order: pre-approval on the decision score and the ratios, the contract and the appraisal with HUD’s property standards, underwriting with any compensating factors documented, and closing with the premiums applied. The steps for a Raleigh buyer follow.
Pre-approval
Start with the decision score, the income, and the down payment. A Lendmire loan officer confirms the leverage, the ratios, and the county limit, runs the FHA structure against conventional and VA on the same numbers, and provides the terms in writing.
Contract and appraisal
The appraisal is the FHA step that surprises buyers most: it reports on condition as well as value. Required repairs are negotiated with the seller, and a low value raises the investment; the Raleigh contract is adjusted or the file moves on.
Underwriting
The file is scored by HUD’s automated system or underwritten manually, with income, assets, credit, and any compensating factors documented. Seasoning after a credit event is confirmed from the discharge or transfer papers, and the ratios are measured on effective income.
Closing
Closing is where the premiums become real: the upfront premium is financed into the total loan and the annual premium is part of the payment from month one. The Raleigh buyer takes the keys and HUD insures the lender.
A brokerage that matches the program to the buyer.
The value of a brokerage on an FHA loan is comparison and candor: FHA against conventional on the same numbers, the premium’s duration stated plainly, the county limit confirmed before the offer, and the terms in writing.
Three programs, one set of numbers
FHA, conventional, and VA are run on the same Raleigh price, score, and income before a recommendation is made. The buyer sees the payment, the insurance, and the cash to close on each, and the choice is made on the figures rather than on habit.
The premium explained before the offer
The FHA annual premium’s duration is decided at origination, and a buyer should know it before signing a contract. Lendmire states it plainly for the Raleigh leverage chosen and explains the refinance path that usually ends it.
Licensed, consumer-purpose, in writing
The parameters on this page are HUD’s and the wholesale overlays’; the terms for a specific Raleigh loan come from a licensed loan officer, in writing, after the review. Lendmire is a broker, never the lender, and not affiliated with the federal government.
Trusted by first-time buyers & families alike.
Raleigh FHA loan FAQs
Plain answers to the questions Raleigh buyers ask most about FHA loans, in the order they usually ask them.
What is an FHA loan, and who is it for?
An FHA loan is the mortgage a Raleigh first-time buyer should compare first: insured by HUD, offered through lenders, written to a small minimum investment and a forgiving credit standard, and priced with mortgage insurance rather than a credit-based premium.
How much do I need to put down on an FHA loan in Raleigh?
The investment is the program’s minimum, applied to the lesser of price and appraised value. Putting down more lowers the premium’s duration: a loan that starts at or below ninety percent leverage sees the annual premium end after eleven years.
What credit score do I need for an FHA loan?
Maximum financing opens at the decision score shown in the snapshot, which is the lowest of the borrowers’ middle scores on the lender’s report. HUD’s rules allow lower scores at reduced leverage, but the wholesale programs behind these pages start at the threshold, so that is the working floor in Raleigh.
How does FHA mortgage insurance work, and how long do I pay it?
FHA insurance is priced by schedule, not by credit score, which is why a modest score pays the same premium as a strong one. The exit from the annual premium on a full-leverage loan is a refinance once equity and credit allow; the calculator shows the premium’s rate and duration for your Raleigh leverage.
What is the FHA loan limit in Raleigh?
FHA caps the loan amount by county and by unit count, and the caps change every year, which is why this page does not quote a figure. A Lendmire loan officer confirms the current limit for the county where you are buying before an offer is written; a purchase above it needs a larger investment or a conventional loan.
Can the seller pay my closing costs on an FHA loan?
They can, up to the share of the price in the snapshot. Anything above it is treated as a price reduction for sizing the loan, and nothing from the seller may fund the minimum investment.
Do I have to live in the home to use an FHA loan?
Yes, as a principal residence, occupied within two months of closing and for at least a year. A non-occupying family member can co-sign; the occupying borrower is the one who lives there.
Is an FHA loan assumable?
It is. A future buyer who qualifies can take over the loan with the lender’s approval, which can make a Raleigh home more attractive to sell when rates have moved up.
Can I buy a duplex or fourplex with an FHA loan?
Up to four units with the buyer living in one. The investment is the same small share of the price, which is why the multi-unit purchase is one of the program’s strongest uses in Raleigh.
Can I take cash out with an FHA refinance?
Cash-out is a full refinance at the snapshot’s cash-out leverage, available after twelve months of owning and occupying the Raleigh home. Payment history on the existing mortgage is part of the review.
FHA, conventional, or VA for Raleigh: compared on your numbers.
Enter your Raleigh figures in the calculator, then request a review. The minimum investment, the premiums, the ratios, and the county limit are confirmed against the program rules, and the terms come in writing from a licensed loan officer.
This guide covers Raleigh — for the statewide guidelines, markets, and scenarios, see FHA Loans in North Carolina, part of Lendmire’s FHA loan program.
Nearby markets in North Carolina: Cary · Durham · Greensboro · Winston-Salem · Charlotte
Related programs: Down Payment Assistance · FHA 203(k) Rehab Loans · Conventional Loans