This doesn’t mean it’s not worth it to increase your credit score to further take better advantage of the FHA benefits, but all that is needed is a 500 to qualify. Note that you will be required to put 10% down on the home, although this can be gifted from family and does not have to be your money.
Qualifying for the 3.5% down payment program requires a minimum of a 580.
Several factors will go in to the loan, but lenders do not get to provide their borrowers the benefits of FHA if they do not have the ability to produce certain credit scores. If you can get to the 580, you are in the ballpark though!
Property Requirements:
Must be Primary Residence
The home you are purchasing must be your primary residence and at least one of the borrowers needs to be living there within 60 days of closing the loan. This means that you or your cosigner must be living at the house purchased with the loan within a 60 day period.
Cannot Be Investment Property
You cannot purchase another home within 90 days of closing.
Home Must Pass Inspection
An FHA appraiser will come review the property before closing to make sure it meets the minimum property standards.
Debt-to-Income:
Your debt-to-income ratio must be below 50%
This is to make sure you have enough money to afford your mortgage. If you make $3,000 a month and have $1,200 in other monthly bills like car payments and any other consistent bills, then your ratio would be 40%.
This is for everyone’s protection. This is essentially a check to make sure this is a good financial decision for you and that you will be able to afford your monthly payment on your home.
Income Requirements:
None
This is more checked in the debt to income ratio, however factors on the consistency of your job and employment history do come in to play.
