how does a fha loan work ? what does your credit score have to be?

Asked by Rutherfordsheila, Powdersville, SC Thu May 19, 2011

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Christopher Pagli’s answer
Christopher…, Agent, Tarrytown, NY
Mon Nov 26, 2012
Here is a blog post I recently did....If you don't already know, the FHA loan in Westchester County NY has become wildly popular over the past few years, partly because lenders have raised the requirements for other loans. The FHA also known as the Federal Housing Administration doesn't actually fund loans, the insure them for FHA approved lenders. As a Westchester County Buyers Agent I have closed more FHA loans this past year then ever before. The attraction to these loans are the minimum of 3.5% down payment requirement, the ability to finance closing costs up to 6% of the purchase price, and the ability to qualify with less then perfect credit.

Although the minimum credit score changes with the times it is currently a minimum of 620-640 for the 3.5% minimum requirement and anything less will require a 10% down payment. You sjhould also know that these credit requirements are the FHA guidelines, you will have to find a bank that will work with the lower scores. I've been told by an FHA specialist that 640 is what a lot of the banks are looking for as a minimum.

The FHA does not back loans for Coops, they do back loans for condos but are limited to those on the FHA approved list. To see if a certain condo is on the approved list you can visit the following link,…

All FHA loans require mortgage insurance and there is also an upfront mortgage insurance premium of 1 3/4% that can be financed.

The FHA loan limits for Westchester County NY are still $729,750 for single family homes and $934,000 for two family homes.

These are the basics, you will need to speak with an FHA specialist to see if you will qualify. Please note that I am not a loan officer, I am a Westchester County Buyers agent that specializes in FHA & conventional loans
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latricegreen…, Renter, Tupelo, MS
Mon Nov 26, 2012
I want to know how do they figure up your score. I am trying to buy a home and all three credit scores are 601,614,563. I was wondering with these could i purchase a home
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Contact us for a free consultation, we may be able to help you with your credit. 877-630-7446 Larry Kunz
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Gregorio Den…, , San Diego, CA
Fri May 20, 2011
FHA mortgages require 3.5% down and as stated by others, are insured by the government but not issued by the government. You can go to most lenders in your area to get an FHA mortgage however, what most tell you about the minimum credit score requirement is untrue. FHA minimum credit score requirements have not been bouncing anywhere, they have been the same since October 4, 2010 and they are a minimum 500 with 10% down and 580 with 3.5% down. Some lenders don't offer FHA mortgages with lower scores but that does not mean it does not exist.

From HUD…
Web Reference:  http://WeFixRates.Com
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..., , Lexington, MA
Fri May 20, 2011
FHA (Federal Housing Administration) itself has minimum scores for its 3.5% and another minimum score for a higher down payment. What you will find is that the lenders who provice the money have stricter requirements and those minimum scores vary between lenders.

You'll also find that places that take lower scores may also deny your loan not for the score itself but for the reasons the score is low - typically late payments, etc. that make the applicant not qualify under FHA's rules.

Our minimum score is 640.
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want to know how do they figure up your score. I am trying to buy a home and all three credit scores are 601,614,563. I was wondering with these could i purchase a home
Flag Mon Nov 26, 2012
David Burnham, , Washington, DC
Fri May 20, 2011
FHA loans are loans issued by regular banks, but insured by the government. They are attractive to buyers because of the loan down payment requirement, however they do include an insurance like premium similar to PMI.

The credit score requirements change from time to time. I think right now the minimum is 600, but it has been bouncing between 620 and 600 over the last year.
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Jim Simms, Mortgage Broker Or Lender, Louisville, KY
Fri May 20, 2011
Credit score is not the deciding factor; it is only the ticket to get in the game. Call Mike below and have him introduce you to his lender.
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Graham Mike, Agent, Columbia, SC
Fri May 20, 2011
FHA stands for Federal Housing Authority and they actually do not purchase loans they insure loans against default. Basically setting guidlines for which Banks and other institutions that lend the money go bye. Please contact me at 803-309-6950 and I can put you intouch with a Mortgage lender who will help you thru the process of obtaining a pre-approval letter which you will need to start your home search.
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