FHA insures mortgages on properties that
consist of detached or semi-detached
dwellings, townhouses or row houses, and
individual units within FHA-approved
condominium projects.

FHA's single-family programs are limited to
owner-occupied principal residences only.
FHA will not insure mortgages on commercial
enterprises, boarding houses, hotels and
motels, tourist houses, private clubs, bed and
sorority houses.
What Is a FHA 203B Loan?
FHA Loan Programs

FHA does not make loans. Rather, it insures
loans made by private lenders in accordance
with FHA Guidelines. The first step in obtaining
an FHA loan is to contact several lenders
and/or mortgage brokers and ask them if they
originate FHA loans. As each lender sets their
own rates and terms, comparison shopping is
important in this market.

Second, the potential lender assesses the
prospective home buyer for risk. The analysis of
one's debt to income ratio enables the buyer to
know what type of home can be afforded
based on monthly income and expenses and is
one risk metric considered by the lender. Other
factors, e.g. payment history on other debts,
are considered and used to make decisions
regarding eligibility and terms for a loan.