July 5, 2011
FHA home loans depend on several factors for loan approval. An FHA borrower must have a history of reliable payments, dependable income that is likely to continue into the future, and the right amount of income versus money paid out for monthly financial obligations.
That amount, called the debt-to-income ratio, is one of the most important factors in determining whether or not to approve or deny an FHA mortgage loan application.
There’s no minimum or maximum income limit for an FHA loan. The FHA looks at the debt-to-income ratio instead, using that as the yardstick which measures the applicant’s ability to pay the monthly FHA mortgage payment along with all other financial obligations. That’s why the government and your lender requires a full accounting of your current debts, including insurance payments, car payments, credit card bills and student loan information.
FHA home loan rules about the amount of debt a borrower may have and still qualify for the FHA mortgage are spelled out in terms of percentages. According to the FHA official site,
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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