An FHA loan can easily be described as a type of mortgage that has been issued by any federally qualified lender and is subsequently insured by the Federal Housing Administration or the FHA as it is more popularly known. By and large, almost all FHA loans have been specifically designed for different types of low to moderate income earning borrowers, who are not in a position to be able to make hefty lump sum down payments, right up front.
By and large a typical FHA Loans is known for having considerably more loose requirements many if not most conventional home loans. However, that does not mean that they do not have any requirements at all. It is just that when compared to commercial market oriented financial company and the myriad different loans they offer, qualifying to their standards is not really all that difficult to begin with. In this case, even if you do not meet any particular FHA standard, it is still possible for you be potentially approved for an FHA loan provided that you are able to prove certain ‘extenuating circumstances’. Some of the requirements for an FHA loan include the following:
- It is imperative that you be able to prove that you have worked in the same field or sector for at least two full years.
- Your income should be consistentthroughout this two year period or it should have increased.
- Your overall credit score should be at least 620 or higher. Moreover, you should have had fewer than two (one monthonly) late payments in the past one year period.
- Your bankruptcy discharge date should not be within the stipulated two years of the FHA’s case assignment date, nor should there be any foreclosure within the preceding 36 month period.
- Any and all FHA Loansare basically available exclusively for primary residence occupancy only. In other words, you have to show visible intent that the property is not being purchased purely for investment purposes, but rather, you intend to live in it.
- It is imperative that you have all the liquid cash required to pay the first time down payment on the FHA loan. This is typically 3.5 percent of the total price of the property. If you do not have this amount then your loan application is liable to be rejected.
Once you have met these requirements then it is time to meet an FHA approved mortgage broker. However, here it is pertinent to note that only fully qualified and federally approved brokers are capable of offering these highly concessionalspecial loans.
For more information regarding the application process for FHA approved loans you can check out https://www.youtube.com/channel/UCMPUUoPTYQG0lHc8wp8SkMQ?view_as=subscriber or log on to http://lutherragsdale.com/shop.