November 8, 2011
To be processed by a lender, FHA home loan applications require detailed credit information from the three major credit reporting agencies. The lender uses these reports to determine that an FHA loan applicant meets the minimum credit requirements for a FHA home loan. Those requirements include the FHA minimum credit score and any additional credit score requirements set by the lender.
The FHA minimum credit score must be above 500, but lenders frequently require scores at 620 or better.
In order to get this credit score information, the lender can’t simply check–there is a specific set of procedures required for a credit check to “count” as an official representation of an FHA loan applicant’s credit worthiness. For example, the FHA rules say the credit data must come directly from the credit reporting agency. A borrower is not permitted to supply copies of credit reports he or she has pulled, nor can credit reporting data come from any other “third party”. It must originate with the credit agency.
Credit reports are only acceptable to the FHA when the report has all credit information available to the reporting agency. A partial report is not permitted. Credit reports must be run on
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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