FHA guidelines allow for borrowers to get a loan after 3 years from the date of a short sale or foreclosure. From the sounds of it you should have no problem with the debt to income (DTI) ratios for a FHA loan. FHA allows 46.99% of your income to go towards a home loan with a total debt load of 56.99%. Depending on your purchase price, a minumum of 3.5% of the purchase price would be required for a down payment. Now, if you choose to buy a home over the lending limits of King County ($567,500) then whatever your purchase price is you have to bring the money down to bring the loan to the loan limits. i.e. $600k purchase price would require down payment over 3.5% to bring loan down to limits. I hope this information helps. I am a licensed loan officer in the state of Washington. We are a national direct lender with access to some of the industries best rates with service second to none. I would be happy to assist you. Please give me a call at any time.
Joshua Lerette - Sr. Loan Officer
Residential Finanance Corp.
What's the difference between a conforming FHA loan and and High Balance FHA? Forgive me for being a novice.
$567,500 is the current FHA high balance loan limit, however you can purchase with as little as 3.5% down or as much as you have reasonably available. If you have $100k available (besides reserves & closing costs) you can purchase a home up to $667,500.
Conformming high balance loans are only $506,000, so this may be a better option anyway.
Rhonda has good advice, 3.5% or 5% work for FHA if everything else is in order. Your scores are great and you have waited the 2 year minimum, so consider looking as soon as you're ready. Rates are incredible right now and hopefully will be in 6 months, but no one knows for sure. Elections can have a lot of consequences.
Congratulations on coming back and doing well.