What You Need To Know About FHA Loan Requirements
You have probably heard that FHA home loans are easier to qualify for than other home loans.
It’s true, there is generally more flexibility with these loans, but how much flexibility depends on the actual lender.
FHA loans are government loans, meaning that they are insured by the government. FHA insures these loans, but approved lenders are the ones who actually approve and fund these loans.
So, what does that mean to you and what are the FHA requirements?
What this means is that since FHA is just insuring lenders against potential losses on these loans, the lenders can set their own guidelines on FHA loans.
That’s right, FHA has a base set of guidelines (requirements for a loan to be eligible for insurance), but each lender can add to or make their own FHA requirements more difficult to avoid taking risks.
It is very common for home buyers and homeowners to get turned down for an FHA home loan at a bank, then get approved for an FHA home loan with a different lender.
Now that you know that FHA Loan Requirements can vary among lenders, let’s take a look at some of the most important requirements.
Credit – each lender can add to the basic FHA requirements, which generally allow lower scores and shorter waiting periods since a prior bankruptcy or foreclosure than conventional loans.
Down Payment – most FHA loans allow for as little as 3.5% down on a purchase and will allow that to come from a gift or even a down payment assistance program, in some cases.
Employment History – generally, lenders are looking for 2 years of stable employment. Requirements will vary among lenders as to how much flexibility there is here.
Debt-to-income – this is the amount of total monthly debt (new housing expenses plus other monthly debts) expressed as a percentage of total gross monthly income. FHA requirements on this are published, but some lenders will allow higher amounts when it makes sense.
So, in short, if you need a home loan program with flexible guidelines, then choosing the right FHA lender is a smart move.
Make sure you ask about their FHA loan Requirements and discuss your unique situation up-front.
We specialize in getting the tough loans approved and we use our flexible FHA loan programs to issue approvals every day. We know the FHA requirements extremely well.
Just check out some of our recent FHA Loan approvals.
Many of our customers are turned down by other lenders before contacting us and are relieved that we can help them.
Are you ready to get approved?
Give us a call and in just a few minutes we will get you pre-qualified.
Call 800-607-1941 x220.
Posted by: Brian Bush
Brian and his team have been funding Home Loans for over 27 years.
Since 1991, they have funded over 3,000 loans