L. Sampson asked: If looking for a no money down or 100 percent mortgage financing, you have several options. Understandably, many homebuyers have little cash on hand for a down payment. Because of the increase in home prices, saving the typical 20% is practically impossible. Fortunately, FHA home loan programs offer 100 percent mortgage financing, which eliminates the need for a large down payment. Here are a few tips on qualifying for a FHA home mortgage loan.
Employment Guideline for Getting a FHA Mortgage Loan
FHA loans are very flexible. Still, before approving a homebuyer for a FHA loan, the lender will carefully review several factors to determine whether they are an ideal candidate for a mortgage loan.
To acquire a FHA loan, lenders require steady employment. Usually, this involves two years of continuously working. It helps to maintain the same employer throughout the two years.
Individuals who change employers every four to six months or those who only held employment for half of the 24 months may have a hard time getting approved for a FHA loan. If unemployment was due to layoffs, illness, or other legitimate excuses, the lender may consider the applicant for approval.
Credit Guidelines for FHA Loans
When reviewing a homebuyer’s application for a mortgage loan, the lender will look at all credit activity that has occurred within the last two to three years. Concerning late payments, applicants cannot have more than two 30 days late payments within a two year period.
Bankruptcies must have a discharged date of at least two years. Furthermore, foreclosures must be at least three years old. In both cases, mortgage lenders require that homebuyers have begun re-establishing credit and building a good credit history.
Income Guidelines for FHA Loans
To qualify for a FHA mortgage loan, lenders will evaluate combine household incomes and other consumer debts (auto loan, credit cards, student loans, etc) to ensure that the mortgage payment does not exceed 30% of income. However, FHA loan lenders are flexible in this regards. Because of rising home prices and modest incomes, lenders may approve loans that exceed 30% of the homebuyer’s income.
Jorge
