Core Insights - The share of all-cash home purchases in the U.S. fell to 29% in December 2025, the lowest for that month since 2020, down from 30.3% a year earlier [1] - The decline in cash purchases is attributed to lower mortgage rates and a strong buyer's market, where sellers outnumber buyers by a record 47% [1] - The use of FHA loans decreased to 14.4%, the lowest December share since 2021, as many low-to-moderate-income Americans have been priced out of the housing market [1] All-Cash Home Purchases - All-cash purchases peaked at nearly 35% in late 2023 due to high mortgage rates, but have since declined as rates fell to an average of 6.09% [1] - Cash deals are still attractive in certain markets, particularly in Texas and Florida, where homes are sitting on the market longer [1] - Buyers paying in cash can negotiate better terms, often securing homes for 10-20% below appraised value [1] FHA Loans - The share of buyers using FHA loans decreased most in Providence, Cleveland, and Jacksonville [1] - FHA loans were most prevalent in Riverside, CA, where 25.6% of mortgaged homebuyers used one [1] - The decline in FHA loans is linked to rising housing costs, which have made it difficult for typical FHA borrowers to enter the market [1] VA Loans - The share of buyers using VA loans increased slightly to 7% in December, with the highest prevalence in Virginia Beach at 36.8% [1] - VA loans were least prevalent in San Francisco (0.7%) and San Jose (1.8%) [1] - The increase in VA loans indicates a stable demand among veterans and service members despite overall market trends [1] Conventional Loans - Over 78.6% of mortgaged homebuyers used conventional loans in December, the highest December share since 2021 [1] - The share of buyers using conventional loans increased most in Cleveland, Providence, and Tampa [1] - Conventional loans were most prevalent in San Francisco, where 98.1% of mortgaged homebuyers opted for this type [1]

Core Insights - FHA loans, insured by the Federal Housing Administration, provide affordable mortgage options for many Americans, especially first-time home buyers and those in low-to-moderate-income households [1][2][3] - The FHA has significantly contributed to the increase in homeownership in the U.S., with approximately 65% of Americans now owning homes compared to only 10% in 1934 [2][3] - FHA loans allow borrowers to finance up to 96.5% of a home's value with loan terms extending up to 30 years, making homeownership more accessible [4] FHA Loan Types - The FHA 203(b) loan is the primary mortgage product for purchasing single- and multi-family homes, serving as the flagship FHA loan [5] - FHA adjustable-rate mortgages (ARMs) offer initial fixed terms followed by adjustments based on market conditions, with options for fixed-rate terms of one, three, five, seven, and ten years [6][7] - FHA loans are available for condominiums, with specific approval processes to ensure compliance with agency requirements [8][9] - The FHA offers Title I and Title II loans for manufactured homes, with Title I allowing land leasing and Title II requiring the purchase of both home and land [10][11] - The FHA Energy Efficient Mortgage program enables financing for energy-saving upgrades, requiring only a 3.5% down payment on the home purchase price [12][13] - The Standard FHA 203(k) mortgage allows financing for home purchases and repairs in one loan, while the Limited 203(k) is for less extensive renovations with a cap of $75,000 [14][16] - The Good Neighbor Next Door program offers significant discounts for eligible professionals, including law enforcement and teachers, with a low down payment requirement [17][18] - The FHA 203(h) loan assists disaster victims in rebuilding or purchasing homes in declared disaster areas with 0% down [19][20] - The FHA Hawaiian Home Lands Loan Program supports Native Hawaiians in homeownership without ongoing mortgage insurance [22][23] - The FHA Indian Reservations and Other Restricted Lands mortgage program facilitates home purchases on tribal lands with a low down payment [25][26] FHA Refinancing Options - The FHA Simple Refinance program allows homeowners to replace their existing FHA loans with new terms, including rolling closing costs into the new loan [27][28] - The FHA Streamline Refinance option simplifies the refinancing process, potentially eliminating the need for an appraisal or credit check, provided certain conditions are met [29] - The FHA cash-out refinance allows homeowners to access equity in their homes, requiring at least 20% equity and full underwriting [30] General FAQs - There are various types of FHA loans available for both purchasing and refinancing homes, with the FHA 203(b) being the most common [31][32] - To qualify for an FHA loan, a minimum credit score of 580 and a 3.5% down payment are typically required, with specific property requirements [33]