FHA LOANS BETWEEN 580< 640  APPROVAL GUIDLINES

• Minimum score of 580 for 3.5% financing.

• A total of 3 trade lines are required for all loans. These trades must have a 12 month payment history and may be alternative credit (if the credit report does not have 3). Alternative trade lines provided to show 12 month payment history will be reviewed by the underwriter and underwriter discretion will be used to determine acceptability.

For borrowers with NO SCORE:

o Maximum ratios of 31/43

o 2 months PITI reserves

• Housing payment history verification is required on all FHA loans, regardless of DU findings. Acceptable rental history includes: Management Company Verification of Rent or 12 months cancelled rent checks with consistent and on time payments OR 12 months bank statements showing consistent monthly payments. Unverifiable housing or living rent free, loan will require additional reserves (see below).

• For all borrowers with unverifiable housing or are currently living rent free the borrower must have 6 months liquid PITI reserves after closing. This may be reduced to 3 months liquid if the borrower is not receiving a gift or grant for closing costs. (liquid = funds available in checking, savings or) money market.

• FHA Underwriter discretion will be used in determining reserve requirements on other loans where the borrower has verified housing. This includes use of 401k funds or reserves required as a compensating factor.

• Owner occupant ratios are considered, regardless of AUS findings, with non-occupant co-borrower. Maximum Occupant ratios are 45/55 or will require management approval.

• Cash back to borrower - DU approve only – anything over $5000 needs management approval after receipt of written purpose from borrower.

• Property Types Allow: SFDs, MFDs (2-4 unit), FHA Approved Condos, Manufactured Homes  and Modular.

Feel Free to Apply Now for an FHA mortgage or use our Quick Application to receive a no obligation consultation.