An FHA loan can be a viable path to homeownership for many types of buyers. If you have a low credit score, an FHA loan might make sense. While most lenders call for a minimum credit score of 620 for conventional loans, FHA loans have looser requirements. Homebuyers with a score as low as 500 can still be eligible for an FHA loan. However, lower scores also mean higher down payments. An FHA loan also is ideal for borrowers who need a loan with low down payment requirements. If you have a minimum 580 credit score, FHA loans require only 3.5 percent down.