FHA A FHA Loan is a mortgage which is insured by the Federal Housing Administration with an approved FHA Bank. Program Highlights The (FHA) Federal Housing Administration loans are backed by federal mortgages which are designed for homeowners who might have lower credit scores. FHA loans also require a lower minimum down payment and a lower credit score than many conventional loans. Qualified borrower(s) are required to purchase mortgage insurance, and also pay premium payments to FHA in order to obtain the guarantee of the FHA.