December 10, 2019

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Articles Tagged With: FHA FICO Requirements

Home Loan Approval: Why FICO Scores Matter

Home Loan Approval: Why FICO Scores Matter

If you want to buy a home, you will need to become well-read about credit, credit scores, and how your credit report affects your ability to apply for a mortgage loan. There are three major credit reporting agencies, Equifax, TransUnion, Experian. The fact that there are three agencies is one good reason why credit experts encourage borrowers to check their credit reports as early as possible prior to applying for an FHA mortgage or any other major line of credit. One credit report could have discrepancies another one does not reflect, etc. A borrower should always know what their lender is going to see on the report before the application is completed. FICO scores are indeed an important part of FHA loan approval, and borrowers should respect FICO scores and | more...

 
Build Your Dream Home: FHA One-Time Close Construction Mortgages

Build Your Dream Home: FHA One-Time Close Construction Mortgages

FHA One-Time Close construction loans, also known as construction-to-permanent mortgages, are a way that borrowers who need a lower down payment and more flexible loan approval guidelines can apply for a home loan that allows the property to be built from scratch. One-Time Close loans, which are sometimes referred to as FHA OTC mortgages, require the borrower to qualify only once for both the construction portion and the mortgage loan. This type of FHA mortgage may vary more among participating lenders because of certain features of the loan including the type of property that can be built, and the loan approval process as it relates to getting construction permits for the project. Some Options Are Available With Some Lenders But Not Others: Shop Around! Your participating lender may not offer | more...

 
FHA Loan Credit Advice

What Should I Know About FHA Loan Requirements?

What should I know about FHA loan requirements? The first thing to keep in mind is that no single factor determines your ability to borrow. Your FICO score is an important part of the loan approval process, but it’s not the only thing you will need to pay attention to in the 12 months leading up to your loan application. FHA Loan Approval Requirements FHA loan standards include a review of your FICO scores to determine whether you are eligible for maximum financing with a 3.5% minimum down payment. Those with FICO scores at 580 or higher are technically eligible for maximum financing. However, this is the FHA loan program minimum standard and your lender may have higher FICO score requirements. FICO scores affect your down payment, interest rate offerings, | more...

 
FHA Home Loan Approval Questions

How Do You Qualify For An FHA Loan?

How do you qualify for an FHA loan? Many want to know what it takes to get approved for an FHA mortgage, and you may be surprised to find out that FHA mortgage loans have more forgiving minimum requirements than other types of home loans. Lender standards will apply above and beyond FHA minimums depending on the financial institution and other factors, but in general FHA mortgages are designed to be more affordable and more forgiving where credit qualifications are concerned. Qualifying For An FHA Mortgage To begin, only owner-occupiers are allowed to get FHA loans. You can’t buy an investment property with an FHA mortgage unless you are a non-profit or a government agency (generally speaking). If you intend to purchase property you will live in as your home | more...

 
FHA Home Loans And Flood Hazard Areas

How Do FHA Loan Requirements Work?

How do FHA loan requirements work? Do you know what you need in order to qualify for an FHA mortgage loan or FHA refinance loan? There are important details you should know about FHA mortgage loans that can help you make an informed decision about applying for one. FHA Loans Feature Lower Down Payment Requirements FHA loan down payment requirements include a minimum 3.5% down based on the adjusted value of the home. You won’t be able to get a zero-down payment FHA mortgage unless you are a qualified borrower applying for an FHA 203(h) mortgage for disaster victims in a federally-declared disaster area. 3.5% down is the minimum cash investment required. Some borrowers with low FICO scores may be required to put down 10% depending on their scores, lender | more...

 
Credit Scores For An FHA Home Loan: When Low Credit Is Not Bad Credit

Who Qualifies For An FHA Loan? Part Two

Who qualifies for an FHA home loan? Many borrowers want to know if they can get approved for an FHA mortgage even with low FICO scores, past mistakes on their credit history, or other issues. What does your lender have to see in your financial details in order to approve your home loan? FHA Borrower Credit Scores The main confusion over FHA home loan FICO score requirements comes when a potential borrower reads FHA loan program standards but doesn’t understand that lender standards may also apply. FHA home loan rules state that a borrower with a FICO score between 500 and 579 is technically eligible for an FHA home loan provided a larger down payment of 10% is made. But a borrower with a 500 FICO score may discover that | more...

 

FHA Loan FICO Scores And Payment History

When the FHA loan rule book (HUD 4000.1) lists its minimum FICO score requirements, some people forget that these requirements are minimums and that participating lenders are free to require higher FICO scores, and often do. We get plenty of reader questions about FHA FICO score requirements–here’s a recent example: “I have my 3 FICO scores they are 633,601, and TransUnion is 565…I have credit but some late payments the last being December 2014…My question is do you think I could get a FICO loan for the mortgage or would I need to bring my FICO up?” The answer to the reader’s question is complex for two reasons–lender standards apply and while based on what’s listed here the reader technically qualifies for an FHA mortgage loan, the lender’s FICO score | more...

 

FHA Loan Credit Requirements Versus Lender Credit Requirements

We get many questions about the difference between FHA loan minimum FICO score and credit requirements and the lender requirements for same. Here’s one of the latest examples: “Seems like there is a lot of contradiction between what is on the FHA site and what the FHA Reps. are answering the consumers the questions. Why have FHA guidelines if the lenders dont have to follow them and can overrule them with their own? I have a credit score of 580 and a one time 30 day late mortgage payment in the past 12 months…” There were other details in the reader question, but the information above was the most pertinent. And the answer to the first part of the question is fairly simple. FHA loan FICO score requirements and other | more...

 

FHA Mortgage Loan Interest Rate Trends

After three solid days of upward movement on interest rates for mortgage loans in general, Friday’s market activity was such that there was no general shift in rates either way–much of the differences seen in Friday’s interest rates would depend on the lender. According to our sources, some were slightly higher, others slightly lower. Some will notice higher or lower actual rates; others will notice the changes in the form of altered closing costs, depending on the lender. 30-year fixed-rate conventional mortgage loans remained in a best-execution range of rates between 3.875% ad 4.0% depending on the lender. FHA mortgage rates continued in their long-held best execution comfort zone of 3.75%. FHA rates tend to vary more among lenders than 30-year fixed rate conventional equivalents, so do some comparison shopping | more...

 

FHA Loans And Your Credit

A reader got in touch with us this week to ask if it is possible to get an FHA mortgage loan even if the borrower doesn’t have “perfect credit”. While it’s not clear what the reader means by that phrase, we can answer the question in a general way. The simple answer is yes, borrowers can apply for and get approved for FHA home loans with less than perfect credit, but much depends on the nature of the credit issues on your report and whether there’s an overall pattern of responsible credit use the lender can use to justify approving your home loan. FHA loan rules are clear that individual mistakes in a borrower’s past should not be the sole determining factor when it comes to approving or denying an | more...