Many lenders require a min fico credit score of 640 to do a FHA loan. But, I am actually able to do them down to 580. And I wanted to give you the guidelines for FHA loans under 640. Here they are:
620-629
· Follows the same guidelines for credit scores over 640
· Interest rate is higher due to Credit Score
600-619
· Need 5% down payment(vs 3.5%)
· Max seller contribution toward closing costs is 6%
· Must be a Citizen or Non Resident Alien(Green Card), no Immigration Visas. Immigration Visas are allowed for credit scores 620+
· No $100 HUD Down Payment Program. They can still buy a HUD home, just not with the $100 Down payment
· Must have 2mths of PITI in reserves
· Max Debt to income ratio is 43%
· No Gift Funds
· Higher Interest Rate due to Credit Score
580-599
· Need 10% down payment
· Max seller contribution toward closing costs is 6%
· Must be a Citizen or Non Resident Alien(Green Card), no Immigration Visas. Immigration Visas are allows for credit scores 620+
· No $100 HUD Down Payment Program. They can still buy a HUD home, just not with the $100 Down payment
· Must have 2mths of PITI in reserves
· Max Debt to income ratio is 36%
· No Gift Funds
· Higher Interest Rate due to Credit Score
This is a great program and will help many more folks buy a home. Keep in mind just because someone has a qualifying credit score does not automatically mean they will get approved. These loans are underwritten by my underwriters, unlike other companies that broker out these types of loans. By doing them ourselves, I guarantee they will close.
This FHA Mortgage program is for credit scores of: 580,581,582,583,584,585,586,587,588,589,590,591,592,593,594,595,596,597,598,599,600,601,602,603, 604,605,606,607,608,609,610,611,612,613,614,615,616, 617,618,619,620,621,622,623,624,625,626,627,628,629,630,631,632,633,634,635,636,637,638,639,640
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