August 19, 2017

Vimeo Channel YouTube Channel

Articles Tagged With: Credit Scores

What does my FHA lender look for in my credit report?

What Does My FHA Lender Look For In My Credit Report?

What does my FHA lender look for in my credit report? That is a very good question to ask, and the earlier in the home loan planning stages you ask, the better off you’ll be. It’s highly recommended that home loan borrowers get copies of their credit reports in the year leading up to a home loan application. You want to know what your credit history says about you before you submit that information to your loan officer. FHA Loan Rules For Credit Reports Your lender is required by the FHA loan program to pull your credit reports, and to use “traditional” credit reporting wherever available. Some borrowers do not have credit, or have non-traditional credit histories. According to the FHA loan handbook, HUD 4000.1, the lender is required to | more...

 
Who sets FHA loan interest rates?

What Is An FHA Loan And How Does It Work?

What is an FHA loan and how does it work? There are many differences between conventional and FHA mortgages, and those differences could mean significant savings depending on your home buying needs and goals. What An FHA Loan Is Not An FHA loan is a mortgage loan, first and foremost. It is intended to buy or refinance a property. An FHA “forward mortgage” or new home loan not intended to act as a personal loan, with cash back to the borrower at closing time. FHA loan rules don’t permit the borrower to apply for a loan greater than the adjusted value of the property plus additional costs that may be rolled into the loan. While your FHA mortgage may be greater than the total adjusted value of the property, you | more...

 
What is the average credit score needed to buy a house?

What Is The Average Credit Score Needed To Buy A House?

If you are a first-time home buyer, you’re likely asking a very common (and very important) question. What is the average credit score needed to buy a house? To get the answer, we decided to see what one of the three major credit reporting agencies, Experian, has to say on this subject. On the official Experian website, the answer to this question might surprise you: “There is no set minimum score to buy a house.” That’s right, you just read a direct quote from the official site of the credit reporting agency, Experian. But that statement does NOT mean there are no FICO score or credit score standards. Each lender has a set of credit score ranges it uses to determine creditworthiness. And many federally insured or guaranteed home loan | more...

 
FHA Loan Credit Score

FHA Loan Credit Score

Do you know what your credit score is? Do you know what lenders require in terms of an FHA loan credit score? The answer might surprise you. The short answer is that there’s a minimum FHA loan credit score requirement to qualify for the program, but lender FICO score requirements will also apply. FHA loan rules in the FHA Single Family Loan Handbook (HUD 4000.1) state that FICO scores of 580 or higher are required for “maximum financing”, which is the cost of the loan minus the borrower’s required 3.5% down payment. Borrowers with FICO scores lower than 580, but not lower than 500 still may qualify for the FHA loan program but with a higher down payment (ten percent). Remember, these are the FHA minimum standards, NOT individual lender | more...

 

FHA Loan Rules For Bankruptcy: Chapter 7 and Chapter 13

We’ve had a number of reader questions in our comments section recently asking about scenarios for loan approval that involve bankruptcy and related issues. Can a borrower get a new FHA loan following a bankruptcy? Under what conditions? FHA loan rules in HUD 4000.1 address this issue with separate entries for Chapter 7 and Chapter 13. According to the FHA loan rule book, Chapter 7 requires the lender to observe the following: “A Chapter 7 bankruptcy (liquidation) does not disqualify a Borrower from obtaining an FHA-insured Mortgage if, at the time of case number assignment, at least two years have elapsed since the date of the bankruptcy discharge. During this time, the Borrower must have: – re-established good credit; or – chosen not to incur new credit obligations.” HUD 4000.1 | more...

 
mortgage loan and business debt

Credit Score Rules For FHA Mortgages

There’s a common reader question about credit score rules for FHA mortgage loans that we get from time to time that goes something like this: “Is it possible to have a low credit score (500-600) and still get an FHA mortgage?” FHA loan rules state that borrowers with credit scores at 580 or higher are eligible for maximum financing for FHA home loans, which requires a 3.5% down payment from the borrower. For those with credit scores between 579 and 500, 10% down is required. However, these FICO score numbers are FHA loan minimum standards and lender requirements can be and often are higher. Credit score rules for FHA loans include the following instructions (see below) to the lender found in HUD 4000.1, the FHA single-family mortgage loan rule book. | more...

 

FHA Loans and Credit Report Issues

FHA home loans offer an alternative to the more strict requirements of conventional mortgages. FHA loans typically feature a lower down payment requirement than many conventional loans, and have more forgiving credit standards (though lender standards will still apply). Some apply for an FHA mortgage unsure of how their past credit activity or even their current FICO score might affect their chances at loan approval. If you are one of those people, there are some things you can do for greater peace of mind going into the loan process. The catch is that advance planning is required-it’s best to start preparing for a major financial commitment like a mortgage a full year or more before applying. The planning time is crucial since you will need to save up money for | more...

 

FICO Scores And FHA Loans

Your credit report and FICO scores are very important factors when it comes to getting an FHA loan approved. Do you know what your FICO score is and how it affects your home loan? The U.S. government’s consumer watchdog agency, the Consumer Financial Protection Bureau, has a definition of FICO scores on its’ official site, which includes the following: “A FICO score is a particular brand of credit score. A credit score is a number that is used to predict how likely you are to pay back a loan on time. Credit scores are used by companies to make decisions such as whether to offer you a mortgage or a credit card. They are also used to determine the interest rate you receive on a loan or credit card, and | more...

 

FHA Loan FICO Score Rules

FICO scores play an important part in any home loan application. There is often confusion about FICO scores, with some applicants assuming that only FICO scores determine loan approval, while others wrongly assuming they only have one credit score. What’s the reality? There are three major credit reporting agencies, (Equifax, TransUnion, Experian) and so a borrower may actually have three different scores. That is one reason why lenders encourage borrowers to check their credit reports as early as possible before applying for an FHA mortgage. One credit report could have discrepancies another one does not reflect, etc. A borrower should always know what the lender is going to see on the report before the application is filled out. FICO scores are indeed an important part of FHA loan approval, but | more...

 
Who can qualify for an FHA loan?

FHA Loan Rules For Credit Qualifying: Credit Reports For Each Applicant

One of the most common questions about FHA home loans involves who gets their credit reports reviewed in the application process. FHA home loans permit co-signers, co-borrowers, and non-occupying co-borrowers, and with so many options open to the applicant(s), it can be confusing when trying to figure out who will need to furnish what information in order to apply. FHA loan rules in HUD 4000.1 instruct the lender on who is to have credit reporting data pulled. On page 171 we learn: “The Mortgagee must obtain a credit report for each Borrower who will be obligated on the mortgage Note. The Mortgagee may obtain a joint report for individuals with joint accounts.” But that’s not the only instruction to the lender. We also learn, “The Mortgagee must obtain a credit | more...