No, you do not need high credit scores or even average credit scores.   However, on the other side of the coin, your credit cannot be 'totally terrible' either!   A good rule of thumb is that you should be able to qualify if you have not been late on your rent payments for the past year and you do not have any SERIOUS late payments on your credit report during the past year.  

Also, please note that 'late' in the mortgage business means a WHOLE MONTH late.   That is, if you did not make your rent payment on the 5th of the month and then your landlord charged you a late fee, that does NOT mean you are late for credit reporting purposes.  For credit reporting and your mortgage application, your rent and other payments and considered ON TIME so long as you made the payment sometime before the end of that month!!!

Although a lot of web sites have calculators that supposedly allow you to figure out how much home you can 'afford' .... I have chosen to NOT put any such calculator here... for the simple reason that you have to know FHA rules before you can accurately calculate your GROSS MONTHLY INCOME!   So... just CALL ME and we can arrive at a reasonable amount for you to spend on a home after just a few minutes of discussion! 

The statutory FHA requirement is that you have to make an investment of 3% in your home.  However, it is actually possible to buy a home with an FHA mortgage with literally zero cash out of pocket.  In order to do it that way you will need the cooperation of the Seller to make a corresponding contribution to a 'Down Payment Assistance' organization on your behalf....but it can be done and frankly I do this type of loan all the time.   (The Down Payment Assistance organization then makes a contribution to cover your down payment; and this is how you can accomplish an FHA home loan with ZERO CASH OUT OF POCKET!)  If the Seller will not agree to do this, you can offer to pay more for the house to include the seller 'contribution' ....which is perfectly OK with FHA.  If the Seller ultimately just will not agree to do so.....then what you have to do is just go find some other home where the Seller is willing to structure the purchase accordingly.    AND.... when selecting a Realtor, you'll do better to find one who is already familiar with FHA loans and these Down Payment Assistance programs.      Please call me to discuss this before you decide how to proceed.  

This depends totally on whether the Seller will agree to pay your closing costs.     Most FHA loans that I process will have ALL of your closing costs AND your prepaids such as the first year of your homeowner's insurance policy - paid totally by the Seller.   Again, if the Seller is not willing to do this, maybe you need to go find some other house!     AND... this is another illustration of why it is so critical for you to select a Realtor who fully appreciates the many good reasons why you wish to use an FHA mortgage to buy your home!

What if I don't have any cash at all for the down payment and closing costs?

As explained above, it is actually possible to buy a home using an FHA mortgage with ZERO cash out of your pocket at closing.    Now, this is not to say it is EASY and you better find someone (such as myself!) who understands how to properly structure an FHA mortgage in order to accomplish this.

Well, the proper answer is to say it the other way around.   That is, FHA is absolutely not going to approve you for a mortgage unless it is quite clear that you can handle the monthly house payments.  Once that determination has been made, then the point simply is that FHA will not deny you just because your cash on hand is very low or even zero.   As we all know, the vast majority of families across the U.S. are running pretty tight on the cash! 

YES!   While I have said above that you can buy a home using an FHA mortgage with zero cash out of pocket... and that is in fact true... nevertheless, there are a few items that will you need cash for up front just as a practical matter.  These are:  

1)  Earnest money.   It will be very difficult to get any home Seller to take you seriously if you submit a purchase contract with NO earnest money!  So, figure at least $250 for this, or possibly $500 if the Seller insists on a higher amount of 'earnest money.' 

2)  Most lenders will require you to pay for an appraisal during the loan process and that should cost about $300-$350.  Generally you need to have the money withing 7 days of your contract being accepted by the seller.

3) I would strongly recommend you get a home inspection to determine what the home will need to have repaired.  That cost is optional and would cost from $200-$400, and will generally be paid within 5 days of your contract being accepted by the seller.

Thus, as a PRACTICAL MATTER, you should try real hard to accumulate at least $1000 before putting in a contract to buy a house.

FHA looks at any of the credit counseling programs such as 'CCCS' exactly the same as if you had gone into a Chapter 13 bankruptcy filing.  That is, it will not prevent you from being qualified, BUT most lenders will require you to be in the CCCS program (or Chapter 13 if you had filed that way) for at least 12 months with 12 months of on time payments before you can be approved for an FHA mortgage.    I do also work with a few FHA lenders that will still approve you even if you have not been in that program yet for a full year...so, call me either way to discuss... we can probably get it done!

The answer to that is NO!     An FHA underwriter will look at your credit history, your employment history, and your total income when deciding whether you should qualify for an FHA mortgage; AND, what I frequently explain to people is that you cannot be WEAK on all three of those!  That is, if you have insufficient credit and insufficient income and a spotty employment record; you will not be approved!    Or to put it another way..... if you have weak spots in one area, then what we need is some corresponding part of your overall application that is a bit stronger....such as, it will be a positive factor if you have held the same job for many years, or you have lived in the same apartment for many years and made all the rent payments on time, or possibly you are able to put down a larger amount on the house so that you will only be borrowing 95% or even just 90% of the purchase price - in order to COMPENSATE if you do in fact have serious credit issues to overcome! 

Do I have to live in the house to get an FHA mortgage?

Yes, absolutely positively.    The whole purpose of FHA is to increase the U.S. quality of life and overall social wellbeing by way of home ownership ..... and therefore FHA mortgages are only for the purpose of buying a HOME that you will LIVE IN! 

Can I use an FHA mortgage for a multi-family home, like a duplex or even a fourplex?

YES!  So long as you live in one of the units, FHA mortgages are available for two family, three family and four family units in addition to single family homes.   The LIMITS here in Pinellas County and the surrounding areas are:    Single family:  $202,800       Two family:  $256,248

Can I apply for a new FHA mortgage to refinance a conventional mortgage?

YES, you can take out a new FHA mortgage to refinance (pay off) your existing mortgage, regardless whether your existing mortgage is an FHA mortgage or a 'conventional' mortgage.

I have a second job where I get paid CASH....can I include that income on my loan application?

Sorry, no!    FHA is a part of the U.S. federal government.  So, if you are not declaring your second job income and not paying your taxes on that income, then why should FHA allow you to include that cash income as part of your loan application?!

I have changed jobs several times over the past couple years, will that be a problem?

NO.    And this is another very nice thing about FHA mortgages..... what is most important for FHA loan approval is that you can demonstrate ongoing income... and it does not matter if you changed jobs any number of times over the past several years.  PLUS, any amount of time that you have spent in school or vocational classes to achieve a position or advance in your career CAN BE counted as if you were working during that time.

I have been unemployed for about six months during the past three years, will that be a problem?

This will probably be OK.     This is another of the many areas where FHA mortgages are more lenient.    That is, in today's economy every FHA underwriter understands that layoffs and job changes are very common.   What we need to do is to go back as far as necessary to document a total of 24 months of actual employment - and of course we'll need to provide letters of explanation for the employment gaps. 

Yes, FHA actually has the best program for co-signers.   Among other things, if you make your mortgage payments on time for the first 12 months, you should be able to remove the co-signer(s)  without too much trouble after a year has passed.    However, please note that anyone who is going to co-sign will have to provide pretty much the same amount of income and credit documentation as you are providing - so the reality is that the cosigner has to be someone who is really willing to put forth a total effort to help you get the sale closed. 

YES, but it will require some compensating factors.    If you have been living with your parents for the past couple years, that alone will not disqualify you for getting an FHA mortgage.  However, since your history of rent payments is one of the most important factors for the FHA underwriter to consider, then it obviously follows that if you do not have any recent rent payment history, we will have to demonstrate other factors in your application that are particularly strong.  Such as, if you were not paying any rent - then hopefully that has allowed you to SAVE some money in the bank!    If that is not the case..... you can appreciate that your file is going to be pretty tough if you have not been paying any rent AND you have not built up any savings AND your recent credit history is poor!

NO!   What people don't realize is that 'late' for credit reporting and mortgage application purposes means a WHOLE MONTH late!   That is, even if you didn't pay your June rent until the 28th day of June, that is NOT LATE for credit purposes...even though your landlord would have been hounding you by that time. 

Yes...BUT, FHA is quite lenient with regard to your STATUS.  That is, you do not have to be a U.S. citizen to apply for an FHA mortgage, and you do not even have to be a permanent resident to apply.   What you do need is a Social Security Number and, if you are not a permanent resident, then you simply need to provide documentation showing that you have the right to work in the U.S. 

Well, there is no such thing as being legally 'separated' in the State of Florida... you are either married or divorced!   Therefore, while it IS OK for you to apply for an FHA mortgage by yourself without your spouse ..... what has to happen is that your spouse must sign the documents at closing needed to put the title to the house only in your name; AND because Florida is a community property state we will have to include all of your spouse's LIABILITIES as YOUR liabilities on your loan application.   Thus, it's more difficult to qualify for an FHA mortgage if you are 'separated' - because, you will not have the benefit of your spouse's income and yet you will have to include all of your spouse's debts on your application. 

Well that's a tough question since every file is different.   For starters let me say this... recently I closed an FHA purchase loan in FOURTEEN DAYS from the day the contract was signed.... and, on the other side of the coin, I closed another FHA mortgage recently that took about TWO MONTHS!!!    Why the big difference?!    The one that took two months had serious mechanical problems with the septic system (mobile home) that had to be resolved; which required the appraiser to re-inspect the home, etc etc!  (That however is pretty rare, as FHA will only require repairs to be made if something in the home substantially affects the livability...such as a water heater that does not put out any hot water!)    

So, the best way I can answer the question is to say that gathering the various documentation normally takes about a week; plus the lender normally takes a bit under one week to underwrite (approve) the file; and then the pre-closing activities normally take a bit less than one week on average.  SO.... you could say that THREE WEEKS is a good target. 

Yes.   If your application is refused now despite all our serious efforts, then it is not the end of the world; as you WILL be able to gain approval by waiting a number of months until your derogatory credit is further into the past.

Well, there is a practical solution - which is to find a house that you can start out LEASING for a few months or even a whole year...... and have it pre-agreed with the landlord that you will then BUY that house when we can get your application to the point where it will be approved.  This is actually a great idea if your recent credit is so problematic that we just cannot get you approved right now...but you need to move into a house NOW in order to get on with your life!