FHA QUALIFICATION - Do I Qualify?

"Easy income qualifications and credit history guidelines make qualifying for an FHA loan easier than a conventional mortgage loan.." by: Leslie Collins - 3/2008 Here are the basic FHA Requirements :

NO Minimum FICO

FHA doesn't require a specific FICO score to qualify.This is the general rule but recent changes in the housing market and the lending industry have set 575 as a minimum FICO. It's still up to the lender so you still need to contact FHA lenders and ask questions.

2 Lines of Credit Needed

You should have at minimum 2 open credit accounts ( credit card, auto payment student loan etc…) in good standing. You don't need traditional FICO score or traditional credit. Non-traditional credit will do in most cases... for example if you are a renter and can prove on-time of your rent, utilities, or auto insurance that may be OK.

Late Payments OK

This is where FHA beats the conventional credit mentality. FHA looks at the overall trend of your credit history, not just your recent history. Late payments, if isolated and explainable will probably not disqualify you. Willingness to pay is the key indicator lenders are interested in.

Collections OK

Collections are OK. Per the HUD guidelines, you do not need any collections to be paid in full to qualify for an FHA loan if they are minor in nature.

No Federal Debts

Must Not be Late on Student Loans FHA requires you never miss any payments on any student loans. You will not qualify if you have been late on any federal debts. .

Judgements - Disallowed For FHA

Judgements need to be paid. The borrower needs to prove that payment arrangements for any judgements have been implemented.

Foreclosure - OK

FHA allows foreclosures.FHA allows foreclosure on your record as long as it's not within the previous 3 years.

Bankruptcy- OK

Chapter 13 bankruptcy - you can qualify for an FHA loan if you can prove you have adequately been making payments for at least one year. Approval by the courts trustee to finalize the loan. Typically, a full explanation of the bankruptcy is required and job stability is required. Chapter 7 bankruptcy - discharge date must be at least 2 years old. A full explanation of the bankruptcy is required as well as job stability.


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