FHA Loan Tips for Improving Credit
Track Your Credit Score and Stay on Top of Problems
While FHA loans are known as a great service for people looking for help buying a house, applicants can make the process even easier if they take steps toward ensuring their credit history is in tip-top shape. The agency advises prospective home buyers to approach FHA loans with their best possible credit history to eliminate any potential risk of not qualifying.
Whether you're looking for a loan to mortgage a new house or to refinance a house you already own, it makes the most sense open up all your options with an optimal credit rating. The FHA recommends having a satisfactory payment history of at least one year before applying for a loan.
Credit Tips for Your FHA Loan
Here are some tips to help you on your way:
- Take a Close Look at Your Credit Reports
You don't know what could be hurting your credit score unless you actually check. Get your credit reports from the three national credit bureaus--Experian, Equifax and TransUnion--at no cost and comb them over for anything suspicious or questionable. - Dispute Inaccuracies
If you find errors on your credit report, notify the reporting bureau in writing so you have a record. Provide any additional records or evidence you have to support your dispute. - Find Professional Help
The FHA recommends applicants with credit problems get help from a Consumer Credit Counseling program. A credit counselor can help you get back on track. - Bankruptcy / Foreclosure
If you've suffered from a bankruptcy or foreclosure in the past few years, you might still be able to qualify for an FHA loan. Develop a satisfactory payment history, re-establish good credit and meet the other FHA requirements.
While your credit history is just one of the many factors that make up your eligibility for an FHA loan, it is no doubt one of the most important. Having a higher score not only helps you qualify, you can also benefit from the low 3.5 percent down payment on mortgage loans available to applicants with a FICO score over 580. FHA approved lenders don't take your credit history lightly, and neither should you.
Helpful Advice - Credit Scores and Loans
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FHA Loan Articles and Mortgage News
August 15, 2019 - Do you really have to make a 20% down payment to get into a home loan? Not with an FHA mortgage. FHA loan program down payment minimums are 3.5% for borrowers with FICO scores at 580 or better. So why do people assume 20% down is required to buy a home?
August 11, 2019 - Some borrowers don’t fully understand the home loan process, which can lead to disastrous results if you don’t understand the lender’s approach to credit checks and other loan underwriting procedures.
August 5, 2019 - If you have monthly financial responsibilities that include paying alimony or child support, there are FHA loan rules your lender will use to determine how such payments affect your debt ratio. How do these factors affect an FHA home loan approval?
August 3, 2019 - What does it take to get approval for an FHA mortgage? Your lender will review many things associated with your mortgage loan application, but there are three main areas you should consider at least a year ahead of your home loan application.
July 30, 2019 - Buying a home for the first time? You will get plenty of advice-some you want, and some you don’t. What should you do once you have prepared in advance by working on your credit, pulling your credit reports, and saving up for the down payment and closing costs?
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!
