peninsularealtor.com

FHA loans are currently available and helping a lot of folks purchase a home because of the low down payment, 3.5% of purchase price.  But some changes are on the horizon.  The Federal Housing Administration (FHA) won't raise the 3.5%minimum down payment requirement for mortgages it guarantees as long as borrowers have FICO scores of 580 or better.  But beginning early this summer, borrowers with credit scores below 580 will be required to make down payments of at least 10% in order to participate in FHA's mortgage insurance program. 

Also this spring, the Obama administration also plans to raise the upfront mortgage insurance premiums paid by all FHA borrowers to 2.25 percent, up from 1.75 percent now.

FHA loans are the easiest type of real estate mortgage loan to qualify for. The FHA guidelines for loan qualification are the most flexible of all mortgage loans that require less than 5% down payment.

Following is the basic FHA loan qualification guidelines.

• Two Years of steady employment, preferably with same employer.

• Last two years Income should be the same or increasing.

• Credit report should typically have less than two thirty day lates in last two years with a minimum credit score of 620 or higher or in some cases no credit score at all.

• Bankruptcy's must be at least two years old, with perfect credit since discharge.

• Foreclosure's must be at least three years old, with perfect credit since.

• Your new mortgage payment should be approximately 30% of your gross (before taxes)  income.

These are some of the most basic of FHA guidelines for qualifying for a FHA loan.  If  you have answered yes to most of these statements, you probably qualify for a FHA mortgage loan.

source: INMAN News, FHA
date: 1.22.10