June 20, 2018

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Home Loan Anxiety Part 2: Credit Issues Before Applying For An FHA Mortgage

Home Loan Anxiety Part 2: Credit Issues Before Applying For An FHA Mortgage

Do you suffer from “home loan anxiety”? Are you worried about your ability to qualify for an FHA mortgage loan? There are some important issues you should know about that can help reduce your worries about applying.

The key is to address your concerns early enough in the planning stages of your new loan to make a real difference.

Worried About Your Credit And How It Might Affect Your Home Loan Application?

One of the best things any borrower suffering from anxiety over a home loan application can do is to contact the FHA directly at their toll-free number (1-800 CALL FHA) and request a referral to a local, HUD-approved housing counselor who can offer advice on preparing for an FHA loan application.

The help of a housing counselor in the early stages of your FHA mortgage loan planning process can save a lot of time and help you avoid common mistakes leading up to the mortgage.

It will also help with anxiety some people feel over not really knowing what they are doing going into the process.

That is a common problem and a housing counselor can address the unknown as it relates to the mortgage process.

Worried About FICO Scores And FHA Loan Approval?

If you are concerned about how your FICO scores may affect FHA loan approval, you should know that FHA home loan rules offer more lenient FICO score requirements for borrowers than conventional mortgages.

The caveat here is that lender standards will also apply so you will need to discuss your concerns with the lender to see what credit score ranges are acceptable for the lowest possible down payment.

You Can Work On Your Credit Before Applying For An FHA Mortgage

In the 12 months leading up to your loan application, make all payments on all financial obligations on time. Do not miss any payments, do not have any late payments. Reduce your monthly debt as much as possible in those 12 months, and do not open any new lines of credit.

These factors will be very important going into your FHA home loan application process no matter if you need to buy an existing construction home, apply for an FHA One-Time Close mortgage, or even refinance your home.

Give yourself a minimum of one year to do this, since the previous 12 months of payments you come to the FHA loan process with may be scrutinized very closely by the lender.

Joe Wallace - Staff Writer

By Joe Wallace

June 12, 2018

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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FHANewsBlog.com was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

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