FHA Mortgages for Borrowers with Derogatory Credit

FHA Mortgages for Borrowers with Derogatory Credit

FHA Mortgages for Borrowers With Derogatory Credit 

Can I get an FHA mortgage if I have no credit history?
Yes
Need Non-Traditional Credit References:
  • 3 eligible, open lines of credit
  • 1 reference a landlord or utility company
  • other credit references: ie.: internet/mobile phone providers, tuition, etc.
What if I’ve missed a mortgage or rent payment?
Yes
  • purchase money loan guidelines are more flexible
  • need “good reason” why payment missed
  • FHA Streamline Refinance program guidelines more strict
What if I have filed for bankruptcy?
Yes
Chapter 7 bankruptcy filing
  • 2 years pass between the date of bankruptcy discharge and the date of home loan application. Note that this is not two years from the date of bankruptcy discharge to the date of closing— it’s two years to an application.
Chapter 13 bankruptcy filing
  • made payments to creditors on time for a period of 1 year
  • written approval of the court-appointed trustee
  • letter of explanation for the bankruptcy filing
  • show that satisfactory credit has been re-established.
Can I get an FHA mortgage if I’ve had a foreclosure?
Yes
  • 3 year lockout period for homeowners who have been foreclosed upon, or who have received a deed-in-lieu of foreclosure
Can I get an FHA mortgage if I have judgments, collections and federal tax liens?
Yes
  • There are no dollar limits for items in collection on an FHA mortgage applicant’s credit report.
  • All judgments to be paid-in-full
  • Federal tax liens to be resolved prior to closing

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