This doesn't necessarily apply to FHA only, it's pretty much the way it goes with almost every mortgage program out there.
The exception: not ALL debt is allowed. Tax liens, any defaulted government insured loans and in general, collections, charge-offs and judgments all need to be satisfied in order to get FHA approval.
If my response was helpful, consider clicking BEST ANSWER!
Senior Loan Officer
STERLING NATIONAL BANK
310 Crossways Park Drive
Woodbury, NY 11797
If you have a prospective buyer, I am able to provide them with more information on financing options, if they chose to work with me as a "Buyers Agent". Contact me anytime at 914-299-0420.
NMLS # 6395
Financing Kentucky One Home at a Time
Mitchell S. Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, Inc.
Office: (718) 645-1665/ Cell: (917) 805-0783
If you have alot of judgments, many late payments, you're a co-signer on another property or you own another property with a substantial mortgage still owed, IRS debt, hefty student loans that you're currently paying or due to pay soon and big car payments then you may have qualification issues.
Now all of the things above can effect your credit and qualification for a loan, but before you try to decide on your own whether you qualify or not, simply speak to a professional mortgage lender or two. They will go over your entire financial profile, help you pay off debts and boost your score quickly if possible in order to see if you can meet the loan requirements.