Wells Fargo All the Major Banks

Wells Fargo All the Major Banks

We hear it all the time!

What's the minimum credit score for an FHA loan?

The answer is. FHA minimum credit score is 500.

All the major banks Wells Fargo, Bank of America, Chase, Citigroup, etc. have minimum credit score guidelines. What this means is that all the major banks including Wells, Bank of America, Chase, Citigroup, etc. banks make the rules for the loans they approve.

Because the banks make the rules for loans they will approve they may require a minimum credit score of 640 for their loans. These guidelines are the bank's guidelines. When you apply for an FHA loan at a major bank and they tell you their minimum credit score requirement is 640. This does not mean that it's the same as FHA's minimum credit score requirements.

It means that they are the bank's minimum credit score guidelines.

On January 20, 2010 FHA announced a policy change to address risk and strengthen finances. FHA changed the minimum FICO scores for new borrowers.

• New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA's 3.5% down payment program. New borrowers with less than a 580 FICO score will be required to put down at least 10%
• This allows the FHA to better balance its risk and continue to provide access for those borrowers who have historically performed well
• This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer

FHA loans have been helping people become homeowners since 1934. A perfect credit score is not needed for an FHA loan approval. In fact, even if you have had credit problems, such as a bankruptcy, it's easier for you to get an FHA loan than a conventional loan.

FHA purchase allows a home buyer to make a down payment of 3.50% and a seller contribution of up to 6% for closing costs with only a 580 credit score. First time home buyer mortgage require a minimum credit score of 580 to put down 3.50% of the purchase price and a seller concession of up to 6% to pay for closing cost.

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All the major banks Wells Fargo, Bank of America, Chase, Citigroup, etc.