A borrower applies for an FHA-insured purchase loan and has a credit score of 580. What is the minimum down payment percentage the borrower must make?

Correct answer: 3.5% of the purchase price

Under FHA guidelines, borrowers with a credit score of 580 or higher qualify for the minimum down payment of 3.5% of the purchase price. Borrowers with scores between 500 and 579 are required to put down at least 10%. Scores below 500 are ineligible for FHA financing entirely. "3.5% of the purchase price" (10%) applies to the lower credit score tier (500–579), not a 580 score. "0% — FHA loans require no down payment" (5%) is not an FHA threshold — it is a common conventional loan down payment but not an FHA benchmark. "5% of the purchase price" is incorrect because FHA loans always require some down payment; it is VA and USDA loans that can offer zero down payment options.