FHA Loans

[Anonymous]

How hard are FHA loans to get? And do they have drawbacks?

[John060675]

That is a good question.  I hope that someone with more experience or knowledge will answer.  I have looked into them some, and it seems to be a good option.  I think there is only a 3% downpayment they require.  One thing I did notice was that their rates were slightly higher than the credit union I belong to.

I plan on applying for a mortgage at the end of next year, after I get my rates up.  I think it is important to have over a 720 (if possible) when applying with them to get the best rates.  I have read one person who said she got a FHA loan with 10% down and a 670 credit score.  It did not list her rate.

I am not sure if this helps, but no one else seems to be answering yet on this thread or the other you posted.

[Anonymous]

With FHA they take a look at everything on your credit. FHA does not care about score but keep in mind that most of the time lower score means bad credit history. FHA will even do loans for borrowers with NO credit scores and will let you use your phone bill, power bill, cell, and etc... as a tradeline if you don't have any.

There are also ways around the 3 percent down. See http://www.ameridream.org. The MBA supports these type of programs and if you look up mortgage fraud with the FBI... They will tell you to look at MBA's website.

[atxhunter]

do you know that the qualifications are for ameridream to get a gift from them? Im currently in Texas with a 50k income and in the process of building a house and it sounds like I can continue to use my lender as long as I'm doing an FHA loan. Just not sure what the income requirments are. Is this like the government assistance programs that cap you if you make too much?

[Anonymous]

PROS:

• Better pricing than most subprime loans
• Low emphasis on FICO score
• Only 3% down for 1-4 units (O/O - required)
• Down payment can be gifted from seller to approved not for profit payable to buyer @ close
• Sellers may directly contribute up to 6% closing costs & ppd interest - (not down payment)
• Rental income payments valued @ 85% - (10% more than most cov financing)
• Cash Out Refinance up to 95% LTV
• Rate & Term Refinance up to 97.75% LTV
• No Income Cap
• No Cash Reserves Required
• DTI borrowing ratios up to 31/43% - manual underwriting can exceed w/compensating factors
• No Prepayment Penalties
• Non-occupying co-borrower income allowed
• Permanent disability income allowed

CONS:

• Full Doc Program - Income must be verifiable
• Lending limits vary by county & lower than (some) other options.
• < 20% down requires 1/5% lump mortgage insurance payment payable @ close.
• Property tax escrows required on all loans - no waivers
• Must use FHA approved appraiser

Edited!

Hi MortgageAdviser:

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Message Edited by fused111 on 09-06-2007 06:38 PM