FHA Credit and Your FHA Loan
Take the Steps to Review Your Credit
FHA loan rules apply for all borrowers when it comes to basic minimum credit standards. The FHA loan requirements that will affect your transaction include FICO score rules, down payment requirements, and the basic terms of your mortgage.
You cannot be rejected for an FHA home loan on the basis of factors that have nothing to do with your financial qualifications, employment, income, being an owner/occupier, etc. A home may not be suitable for an FHA loan, a borrower may be denied the loan because he or she doesn't intend to live in the property as the primary residence, or because of factors that affect the economic life of the property.
Credit Requirements for FHA Loans
FHA loans provide great assistance to many first-time home buyers by offering mortgage loans with lower down payments. While this is a benefit for many people, recent changes in FHA Loan credit requirements may have put the loans just out of reach for some would-be homeowners with questionable credit history.
- The Facts About FHA Credit Requirements and FICO® Scores
- What FICO® Score Do I Need Buy A Home?
- Do FHA Loan Requirements Apply to All Borrowers?
Benefits of Having Good Credit
Homebuyers looking to take advantage of great FHA loan benefits should already know they need to establish the best possible credit rating. FHA loan applicants with a better credit rating increase their options for mortgage or refinance loans.
In order to qualify for the low 3.5% FHA loan down payment, applicants will need a FICO® score of at least 580. Those that don't meet that criteria will have to put a down payment of 10% on the mortgage they want.
- Are My Tax Returns Required for an FHA Loan?
- How Your Credit Report Affects FHA Loan Approval
- Time to Get Started With an FHA Loan
Improving Your Credit
If your credit is less than solid, consider delaying your home purchase and work on improving their credit scores. Applicants who have a minimum credit score of less than 500 are not eligible for FHA mortgages.
While FHA loans are a great option for people buying a house, applicants can make the process even easier if they take steps toward ensuring their credit history is in tip-top shape. FHA advises prospective home buyers to approach the loan process with their best possible credit history to eliminate any potential risk of not qualifying.
- Your FHA Loan Credit Qualifications
- Minimum Credit Scores for FHA Loans
- What Should I Know About Applying for an FHA Mortgage?
Fixing Credit Report Errors
Some borrowers who want to apply for an FHA loan find their applications held up by problems with what is on their credit report. Take proper steps to check the accuracy of your credit report with Experian®, TransUnion® and Equifax®.
Once you've gotten your report from the three bureaus, carefully examine your credit history for anything out of the ordinary, such as unauthorized loans taken out in your name, incorrect late payment records or anything that seems questionable, no matter how minor you think it is.
- Credit Monitoring, Data Security Breaches, and Your FHA Loan
- The Facts About FHA Credit Requirements and FICO Scores
- FHA Home Loan Applications and Credit Freeze Issues
Identity Theft and Fraud in the News
Now more than ever, it is crucial to pay close attention to your credit reports due to elevated security breaches, hacks, and security compromises. No major corporation is immune to these attacks-including the credit reporting agencies themselves.
We've listed a timeline of some of the most headline-grabbing hacks reported in recent years. Remember, these are only SOME of the incidents you may have heard about; each one is a good example of why it pays to continuously monitor your credit.
- FHA Home Loan Applications and Credit Freeze Issues
- Credit Monitoring, Data Security Breaches, and Your FHA Loan
- Credit Advice for Home Loan Applicants
FREE CREDIT SCORES From All 3 Bureaus
Do you know what's on your credit report?
Learn what your score means.
FHA Loan Articles and Mortgage News
September 25, 2018 - This is a common question, and at first glance, FHA loan rules do prohibit using single family FHA mortgages to purchase investment real estate. But much depends on the buyer’s definition of investment property compared to the FHA view.
September 24, 2018 - FHA home loans are attractive to many borrowers because the FHA guidelines are more forgiving with FICO scores, and a lower down payment is required than for some other mortgages. But your down payment requirements aren’t just set by the FHA; lender standards also have a say.
September 20, 2018 - FHA borrowers who have experienced this negative credit event often wonder if it account collections in their credit histories will hurt their chances for FHA home loan approvals; much depends on the age, the amount, circumstances, and lender requirements in this area.
September 18, 2018 - There are some important questions to ask yourself as you begin the planning stages for a new FHA home loan. If you are going into the process without the answers to these important questions, you might not be ready to apply for a new loan just yet.
September 14, 2018 - Borrowers who have high debt ratios, and/or FICO score issues may still be able to be approved for an FHA mortgage loan but the lender may require one or more compensating factors to justify loan approval.
FHA.com Reviews
FHA.com is a one-stop resource for homebuyers who want to make the best decisions when it comes to their mortgage. With our detailed, mobile-friendly site, individuals can access information about different FHA products, the latest loan limits, and numerous other resources to make their homebuying experience easier. Take a look at some of the reviews from other FHA.com visitors!
