With more prime lending options than subprime, FHA loans offer no credit or damaged credit buyers to enter a more secure buying environment which is government backed. Many grants have been enacted to help keep buyer infusion of funds around 1.75 to 5%, with 3% being an average. Since FHA has rewritten some of their acceptance terms, LTV’s can go over 95% and, combined with other assistance programs, could actually add up to bigger savings for families hovering around the national poverty level.

After taking applicant information and gauging credit risk, FHA-approved lenders will have prospective home appraised, determine points, qualify borrowers for programs, and lay down plans. New FHA rules were to mandate that all medical bills must be spoken for before applying, although that rule addition was repealed in June of 2013. Since buying a home is at the top of the list of major life events, it can also be a very high-stress process, especially if you are buying a home for the first time. This is why many families with questionable incomes will choose the FHA path.