FHA Mortgages

FHA Loans: Credit score Rating Suggestions

fha-loans-credit-score-rating-suggestions

What is a Good FHA Credit Credit Score? In general, the obvious advice is that you should try to get into the home loan process with as high a FICO score as possible for the best results.

But not everyone has the advantage of an excellent credit rating. What do prospective homeowners need to know about FHA loan requirements and their creditworthiness?

First of all, you should know that no two lenders are exactly alike and it is a bad idea to assume that you will get the same results from all of them.

Don’t assume that you may not qualify for a loan – let a loan officer help you decide which type of mortgage is right for you.

FHA credit rating tip: shopping spree

Why do we say “shop around” when it comes to FICO scores and FHA loans?

Borrowers with FICO scores in the 580 zone or better must understand that your selected participating FHA lender may not approve a home loan at the lowest end of that FICO score without requiring a higher down payment. Lender standards also apply. Not just FHA minimums.

So, you’re going to want to look for an FHA lender who is ready to do something with your FICO score.

FHA credit rating tip: Think like a lender

What does your lender see when they open your credit report? If your job relies on interpreting what you see and approving a loan that could pose a risk to the business, then how strictly will the lender check your loan history?

FICO score numbers aren’t the only thing used to approve a loan – loan history also counts. How many late payments did you have in the 12 months prior to your loan application? If the answer is greater than zero, you may not be ready for a mortgage loan just yet.

Have you missed mortgage payments in the past? Or are your monthly rent and debt payments clean in terms of on-time payment?

FHA Home Loan Tip: Use Your Resources

When considering what to do about your credit score, keep in mind that there is a lot you can do to fix your own credit score. To protect yourself from nasty surprises along the way at home loan application time and beyond, you can and should subscribe to a good, reputable credit monitoring service.

However, there are other resources that you should use, such as the FHA Housing Advisor Referral Option – you may be referred to a HUD-approved Housing Advisor in your area who can advise you on financial preparation for a new home loan.

You can call the FHA on direct number 1-800 CALL FHA for the referral.

Find out more about the path to home ownership
Take the guesswork out of buying and owning a home. Once you know where you want to go, we’ll get you there in 9 steps.

Step 1: How Much Can You Afford?
Step 2: Know Your Home Buying Rights
Step 3: basic mortgage terminology
Step 4: buy a mortgage
Step 5: shopping for your home
Step 6: Make an offer to the seller
Step 7: get a home inspection
Step 8: home insurance
Step 9: what to expect upon graduation

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