FHA Housing Loans are low down payment loans guaranteed by FHA. FHA is an entity of the United States government that provides mortgage insurance for FHA Approved Lenders.
The main reason lenders would lend to home buyers that only have a small amount of money for a down payment is the FHA takes away much of the risk to the lender. If the FHA Housing Loan defaults then FHA will reimburse fully the amount of the loan to the lender. Because of the government insurance the lenders are willing to give more lenient terms to the home buyer.