FHA on April 2012 changed it's collection account guidelines. Going forward all collection accounts within the last two years must be paid off. All collection accounts totaling over $1,000.00 must be paid off. Collection accounts that total less than $1,000.00 and are over two years old may not have to be paid off.
If you have collection accounts that are not paid off - FHA allows you to set up a payment arrangement to qualify. By setting up a payment arrangement FHA will allow you to make three on time monthly payments to qualify for a FHA loan.
FHA minimum credit score is 500. New FHA policy requires a minimum credit of 500 to buy a home or refinance. In the old days FHA did not require any credit score. These changes went in to effect in 2010.
To buy a home you will need a minimum credit score of 500.
Borrowers with credit score above 580 require a 3.5% down payment. The funds can be a gift from a family member and a 6% seller's concession is allowed. Often, 12 months of rental history is required for credit score below 620.
If you have credit scores below 580 new FHA changes require a 10% down payment. All funds must be the borrower's own funds. No gifts are allowed and no seller's concession allowed. Many times 3 to 6 months reserves may be required.
What documentation will I need?
• Personal tax returns for the past 2 years
• Current pay stubs for the past month
• Bank statements for last 2 months (all pages)
• Latest retirement statement for each active account (all pages)
• Sales contract (if purchase)
• Clear copy of Driver’s License (front and back)
• Clear copy of SS card (front and back)
• Addresses and loan information of other real estate owned (if any)
Apply now.
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FHA loan requirements new borrowers with less than a 580 credit score will be required to put down at least 10%
FHA requires a minimum credit score of 500 to buy a home or refinance
Chapter 7 Bankruptcy at least two years must have elapsed since the discharge date
Foreclosure must have been resolved for at least 3 years
Government loan: Seasoning is determined by the date the claim was paid
Loans other than Government: Seasoning is determined by the date of sale the lender sold the property
FHA guidelines requires three year past from the date of sale of the property
What documentation will I need?
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