Buying a home in Miami can feel expensive. Many people think they need 20% down, but that is not true. An FHA loan lets you buy a home with as little as 3.5% down. This guide explains the rules in plain words.
What Is an FHA Loan?
An FHA loan is a mortgage insured by the Federal Housing Administration. The government backs it, so lenders can approve buyers who may not fit a regular loan. That is why it is popular with first-time buyers and people still building their credit.
If you want to see how this works for Miami buyers, visit the FHA loans in Miami page.
FHA Loan Requirements in Miami
These are the main rules. Every lender can add its own extra rules, so always confirm before you apply.
1. Credit score
- 580 or higher: you can put down just 3.5%.
- 500 to 579: you usually need at least 10% down.
2. Down payment
You need at least 3.5% of the purchase price. The money can come from your savings, a gift from a family member, or a down payment assistance program.
3. Steady income
Lenders usually want to see about 2 years of work history. Self-employed? You still have options. Programs like an FHA P&L loan can work for business owners, as explained on Nelly’s loan options section.
4. Debt-to-income ratio (DTI)
DTI compares your monthly debts to your monthly income. Many lenders look for about 43% or less. With strong savings or good credit, some approvals go higher.
5. Owner-occupied home
You must live in the home as your main residence. FHA loans are not for pure investment properties. (If you are an investor, check out the home loans in Miami page for other choices.)
6. FHA appraisal
The home must be safe, sound and in good condition. An FHA-approved appraiser checks this. This matters a lot for older Miami homes.
7. Condo approval
Many Miami buyers want a condo. For an FHA loan, the condo building must usually be FHA-approved. Ask about this before you make an offer.
FHA Loan Limit in Miami-Dade
FHA loans have a maximum loan size. For 2026, the limit for a single-family home in Miami-Dade County is about $667,000, according to published county tables. With 3.5% down, that means you can buy a home priced up to roughly $690,000. Limits change every year and for 2- to 4-unit homes, so check HUD’s lookup tool or ask your loan officer for the exact number.
If the home costs more than this, a conventional or jumbo loan may fit better.
Mortgage Insurance (MIP)
FHA loans have two kinds of mortgage insurance:
- Upfront MIP: 1.75% of the loan. Most buyers add it to the loan instead of paying cash.
- Annual MIP: a yearly fee split into your monthly payment. It is often about 0.55% for a typical 30-year loan with a small down payment.
For a $386,000 loan, the upfront MIP is about $6,755, and the annual MIP is about $177 per month. With less than 10% down, you usually pay the annual MIP for the life of the loan. With 10% or more down, it usually drops off after 11 years. Many buyers refinance later to remove it.
Closing Costs
Your down payment is not the only cash you need. Closing costs often run from 2% to 5% of the price. They can include the lender fee, appraisal, title, taxes and insurance setup.
Good news: FHA rules let the seller help pay some of your closing costs, and gift money from family is allowed. Ask your agent to negotiate this in your offer.
Down Payment Assistance in Florida
Many buyers in Miami use help programs to lower the cash they need. Florida Housing Finance Corporation and Miami-Dade County both run programs, and each has its own income limits, credit rules and steps. These programs change often, so ask Nelly which ones you can combine with an FHA loan.
Pros and Cons of FHA Loans
Pros
- Low 3.5% down payment
- Easier credit rules
- Gift funds allowed
- Competitive rates
Cons
- Mortgage insurance for years
- Loan limits apply
- Home must meet FHA condition rules
How to Get Started
- Check your credit and gather income documents.
- Know your three numbers: a monthly payment you are comfortable with, your cash to close, and your price range.
- Get pre-approved. It shows sellers you are serious.
- Shop for a home with your agent.
- Close and get your keys.
You can read about each step on the How It Works section of the site.
Talk to a Miami FHA Loan Expert
Rules and rates change, and every buyer is different. Nelly Santiesteban is a Miami mortgage loan officer who has helped buyers since 2005. She speaks English and Spanish and explains each step in a clear way.
Ready to see what you qualify for? Contact Nelly today or call (786) 286-5906. You can also browse more guides on the blog.
