September 23, 2013
August 15, 2013 - Borrowers with a prior bankruptcy, foreclosure, deed-in-lieu, or short sale may be eligible for an FHA insured loan if the bankruptcy, foreclosure, deed-in-lieu, short sale was the result of a documented extenuating circumstance.
Borrowers may also be eligible for an FHA insured loan on a purchase transaction after 12 months from the completion, discharge, trustee's sale if the borrower meets the requirements for extenuating circumstances Economic Event.
On January 20, 2010 FHA announced a policy change to address risk and strengthen finances. FHA changed the minimum credit scores for new borrowers:
FHA minimum credit score
FHA allows a borrower with a credit score of 580 to buy a home with only a 3.5% down payment. FHA guidelines allows a borrower with a minimum credit score of 580 to buy a home using their own funds for a down payment or the down payment funds can be a gift from a family member.
FHA guidelines allows a home buyer with a minimum credit score of 530 up to a 6% seller's concession. The seller's concession must be written into the sales contract.
buyers with a credit score below 580 are required to make a 10% down
payment. The down payment funds can belong to the borrower or can be a gift from a family member.
Call us 888.958.4228
Mortgage World Home Loans is an online mortgage company specializing in FHA loans for first time home buyers. To buy a house with 3.5% down payment and a minimum credit score of 580 using an FHA loan, apply online.
We look forward to working with you.