FHA Home Loans Refinancing

FHA Loan Guidelines and Credit Requirements

09.15.10

The Housing of Urban Development (HUD) has made it clear that in the FHA credit standards are changing for 2011.  HUD and the Obama administration have several goals they have outlined to improve the credibility of their flagship FHA home loan programs. The first goal is to bolster the FHA loan reserves and the second goal is to reduce loan defaults and foreclosures.

In order to accomplish these goals, HUD must tighten the FHA guidelines and increase the accountability for FHA lenders with more comprehensive FHA requirements.  FHA credit score minimums have never been enforced in the past because HUD always prided itself that the FHA loan guidelines enabled underwriters to consider a borrower for government financing based on all of their credentials rather than just a credit score.

   * Higher Down-Payments for Bad Credit * FHA Credit Score Minimums * More Equity for Refinancing w/ Bad Credit

Is this End of Bad Credit Home Financing for FHA?

*  Minimum credit score at or above 580 are eligible for maximum 97.5% Loan to Value for FHA financing (3.5% down-payments required with purchases).

*  Minimum credit score between 500 and 579 are restricted to 90% Loan to Value for FHA finance options (10% down-payment required).

*  Minimum credit score of less than 500 are not eligible for FHA- mortgage loans insured by the government.

*  FHA borrowers with a non-traditional credit history or insufficient credit are eligible for maximum financing if they otherwise meet FHA guidelines.

*  Borrowers using 203(h), Mortgage Insurance for Disaster Victims, are eligible for 100% mortgage financing and no down-payment is required.  However, FHA borrowers must have at least a 500 credit score to be eligible.

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20 comments so far

What are FHA guidelines for bankruptcy? How long must you wait before you can borrow from FHA?

Can some please send or direct me to where I can find FHA guidelines when financing a condo?

If i have a credit score less 500, but i have a co-borrower that is retired. can i still get a loan to purchase a home?

@ FHA MORTGAGE REFINANCE:

2 years after your bankruptcy discharge date, you can apply for an FHA loan

[...] 740 yeah right…. 2011 FHA Loan Guidelines and Credit Requirements [...]

I have a credit repair company working to clear 4 items that I have no idea what they are for. My goal to purchase a house is Nov 2011. I don’t want to rent. My CS is around 600 or a little less. My dad has a CS of 780 and is retired but would like to be a co-signer for me. My total income is 91,913 and zero debt. Is there a possibilty of an FHA Loan. HELP!!!

I had 2 homes in a BK discharged in April 2009. I have heard that I qualify for FHA loan now and I have also heard that I have to wait 3 years from the discharge date (because houses were involved. Which is it? I don’t want to apply for anything until I know as each credit pull affects my credit score which is good.

Right now the minimum score that lenders will allow to do an FHA loan is 640. There are no lenders that I know of that will do an FHA loan under a 640 middle credit score even though FHA guidelines are lower.

Can you tell me if the credit score you get from Karma Credit Score, is creditable? I don’t want to have someone look into my credit score, every time I ask if I qualify for a FHA refinance loan. Because my score goes down. Thank you..

Our credit score is much lower than 640 and we were approved for an FHA loan.

There are lenders that will loan with a 580 credit score. Just need to REALLY look for them. You may also have to put 3.5% down. It’s possible! If your credit score is above 600, you have steady income, and a good amount of income, then you should be fine.

23 yrs ago when I was single I had a wheda loan for first time home buyers. I am married now and my husband has never owned a home would he qualify as a first time home buyer?

if a spouse has better credit no debt must the married persons debt be added to the borrower even though u cant use their income to get approved for an fha loan

About a year ago my husband and I were in the process of buying our first home. We live in Texas and he is still attached to the mortgage from his first marriage. His kids and ex wife live there currently. She stopped making payments on the house for 3-4 months which made my husband’s credit score drop dramatically. We got his score back up to where it needed to be and went through manual underwriting only to find out that the requirements for obtaining a home loan had changed and there couldn’t be a late mortgage payment on your credit history within a certain time period. Can you tell me what that time period is? It has been 12 months and we call regularly to make sure the previous mortgage has been paid on time. It has been for the last 12 months. We need to know if this is enough time to meet all requirements and try again or if we need to wait longer. Any help would be greatly appreciated.

Is it possible to obtain a loan while still in Chapt 13 bankruptcy? Payments have been ontime, CS is 668, annual income >85,000, debts less than 5% monthly income. File 5/2010

What if my credit score is 690 and spouse with defaulted school loan 560?

[...] If you are interested in FHA loans, you may wish to read up on FHA loan qualifications here. [...]

I have good credit over 780 but I am a self employee and for last two yrs I am not making money. My last yr tax less than $40k home loan is over $360k. Do you do no income verify equity loan?

To Whom It May Concern:

My name is Mr. Foster and I have recently attempted to purchase a home in Las Vegas, Nevada. I have a Credit Score of 740, I gross $160,000.00 a year with overtime included, and I have worked as a Union Pipe-fitter for 28 years through contract work. I do not have any negative information on my credit, any foreclosures, any repossessions, etc. However, I was denied a loan because my employer of 18 years would not “check a box” that would guarantee me three (3) years of overtime or work in the future. What is wrong with this picture? I don’t believe there are any companies in the job market today that will guarantee any of their employees’ future employment. They would be setting themselves up for a possible lawsuit. In addition, I was under the assumption that a loan was based off a persons’ past work history, W-2’s, taxes, etc.

There are numerous people out there that have gone to contract work because of the changes in the economy. I believe what I have recently experienced with these mortgage companies is a form of prejudice against people who have decided not to default on their existing loans by acquiring steady work throughout the country as contract workers. Why would you punish those of us that have retained work and kept our mortgages and bills current when the remaining 60% of the United States workers have decided to take advantage of the system with unemployment benefits and welfare?

This ordeal of attempting to purchase a home has left a bad taste in my mouth. At this time, I will save my funds until the bureaucrats finally get their heads out of the mud and decide to make money which will help fix this economy.

Below you will find the Mortgage Lenders where I applied for a home loan and was denied: “because my employer of 18 years would not “check a box” that would guarantee me overtime or three (3) years of work in the future.”

1. VanDyk Mortgage Corp.
153 W. Lake Mead Pkwy. Ste 2250
Henderson, NV 89015
Ph (702) 982-8870
Fax (702) 446-8237

2. Security National Mortgage
6655 W Sahara Ave Apt W
Las Vegas, NV 89146
Ph (702) 367-4790

Note: I am sending a copy of this letter to the Attorney General of the State of Nevada. This is the worst state in the Union with regards to housing problems and your mortgage companies won’t sell the homes to legitimate buyers.

Did you know that companies that report credit info like Trans Union, Equifax and Experian must investigate the items you question within 30 days? This is true, unless these companies consider your dispute frivolous. They also must forward all the relevant data you provide about the inaccuracy to the organization that provided the information. After the information provider gets notice of a dispute from the credit reporting company, it must investigate, review the relevant information, and report the results back to the credit reporting company.





 

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