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Sacramento has become one of California's most active markets for first-time buyers. FHA loans are doing a lot of the heavy lifting here.
The 3.5% down requirement makes FHA the go-to option for buyers who can't stack a 20% conventional down payment in this market.
580 (3.5% down)
Min Credit Score
3.5%
Min Down Payment
1.75% of loan
Upfront MIP
1-4 unit primary
Property Types
Fixed or adjustable
Rate Type
FHA Loans in Sacramento
To get the 3.5% down, you need a 580 credit score. Drop below 580 to 500, and lenders require 10% down instead.
FHA also caps your debt-to-income ratio — that's your monthly debt vs. your gross income — at 43% for most lenders. Some go higher with compensating factors.
Local decision guide
Use this guide to connect fha loans eligibility, lender expectations, and local market factors before comparing payment options in Sacramento.
Sacramento has become one of California's most active markets for first-time buyers. FHA loans are doing a lot of the heavy lifting here.
The 3.5% down requirement makes FHA the go-to option for buyers who can't stack a 20% conventional down payment in this market.
To get the 3.5% down, you need a 580 credit score. Drop below 580 to 500, and lenders require 10% down instead.
Not every lender prices FHA the same. Mortgage insurance premiums are fixed by HUD, but rates and overlays vary widely across lenders.
We shop FHA across 200+ wholesale lenders. Some have stricter overlays — minimum 620 scores even though FHA allows 580. Finding the right lender matters.
The biggest FHA mistake I see in Sacramento? Buyers underestimating mortgage insurance. FHA charges an upfront MIP of 1.75% plus annual MIP — it adds up fast.
Unlike conventional loans, FHA MIP doesn't cancel automatically at 20% equity on most loans. If you plan to stay long-term, run the numbers against a conventional loan first.
Conventional loans let you drop PMI once you hit 20% equity. FHA MIP typically stays for the loan's full term. That's a real cost difference over 10-15 years.
VA loans beat FHA on cost — no MIP at all — but you need military service. USDA loans also have lower MIP, but Sacramento city properties don't qualify for USDA.
Sacramento County's FHA loan limit as of April 2026 sets the ceiling on what you can borrow. Homes priced above that limit require a jumbo or conventional loan instead.
Sacramento's housing stock includes a lot of older homes. FHA has property condition requirements — a fixer in poor shape can kill an FHA deal before it closes.
Loan limits are set by HUD and updated annually. Check current Sacramento County FHA limits before assuming your target price is within range.
Yes, FHA covers 2-4 unit properties if you live in one unit. This is a popular strategy for buyers who want rental income to offset their payment.
On most FHA loans with less than 10% down, MIP stays for the life of the loan. The only way out is refinancing into a conventional loan.
Some do, especially in competitive situations. FHA appraisals flag property issues that conventional appraisals sometimes overlook — that can concern sellers.
Most FHA loans close in 30-45 days. A thorough pre-approval upfront keeps the process from dragging out.
Yes. FHA requires a 2-year waiting period after Chapter 7. Chapter 13 may qualify in as little as 12 months with court approval and clean payment history.