FHA loans in Colorado
Buy your Colorado home with as little as 3.5% down
FHA loans are backed by the Federal Housing Administration, with flexible credit guidelines and gift-friendly down payment rules — a strong fit for first-time buyers.
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- 30+ years of experience
Why buyers choose FHA
Lower barriers to entry than most conventional loans.
3.5% down payment
Flexible credit
Room on debt-to-income
Gift funds allowed
FHA requirements
- 580+ credit score for 3.5% down (500–579 with 10% down)
- Steady employment history, typically two years
- The home must be your primary residence
- The property must meet FHA standards and appraise
- Debt-to-income generally at or below 43%, higher with compensating factors
- Waiting periods after bankruptcy (typically 2 years) or foreclosure (typically 3 years)
How the process works
- 1Get pre-approved — we review your credit, income and assets
- 2Find your Colorado home with your real estate agent
- 3Submit your full application and documents
- 4FHA appraisal confirms the home's value and condition
- 5Underwriting review and final approval
- 6Close on your new home — typically 30–45 days from contract
FHA loan questions
FHA loans require a minimum credit score of 580 for the 3.5% down payment option. Borrowers with scores between 500-579 may still qualify but will need a 10% down payment. Many Colorado lenders, including Cedar Home Loans, work with borrowers across the credit spectrum to find the best path to homeownership.
The minimum down payment for an FHA loan is 3.5% of the purchase price with a credit score of 580 or higher. On a $400,000 Colorado home, that's just $14,000 down. Your down payment can come from savings, gift funds from family, or down payment assistance programs.
FHA loans require two types of mortgage insurance: an upfront premium of 1.75% of the loan amount (which can be rolled into the loan) and an annual premium of 0.55% paid monthly. For most FHA loans originated after 2013, MIP lasts the life of the loan unless you refinance to a conventional mortgage.
HUD sets FHA loan limits every year, and they vary by county. Higher-cost counties such as Boulder, Eagle, Summit and the Denver metro have higher limits than the rest of the state, which keeps FHA workable in many mountain and Front Range markets. We'll confirm the current limit for your county before you make an offer.
Yes, but the condominium project must be on the FHA-approved condo list or receive a Single Unit Approval. Many Colorado condo developments are FHA-approved. We can help you verify whether a specific property qualifies before you make an offer.
Absolutely. FHA loans allow 100% of the down payment to come from gift funds from family members, employers, or charitable organizations. A gift letter documenting the source and confirming no repayment is required. This makes FHA loans especially accessible for first-time homebuyers.
See what you qualify for with FHA
Pre-approval takes a few minutes to start. Andrew will walk you through FHA and compare it against your other options.