The major banks in the United States use the Federal Funds Rate as a rule of thumb for establishing their own Prime Rates. Most of the time, any individual bank’s Prime Rate is the FFR plus about 300 basis points, or three percent. So, if the FFR is 1.5 percent, the FHA lending rate might be 5.5 percent. Or it could be 3 percent. This all depends on how badly those banks want to do business with FHA borrowers.