How can I get a FHA loan when my credit score is a 581?

A: In theory, you should be able to obtain an FHA-backed mortgage. However, mortgage lenders are so afraid about being asked to buy back failed loans that they have added "overlays" to the minimum requires standards for credit score (and other underwriting criterion). The practical effect is that it is very, very hard to obtain a loan with a score much below 620. You should review your credit history and correct any errors and work hard to get your score up off the bottom before you try to apply for a loan.