December 1, 2011
A reader recently wrote, asking a very good question about how FHA loan rules address loan applicants with non-traditional credit histories.
“My husband and I had not considered an FHA loan, but now I’m wondering if we would qualify. We don’t use credit cards and we paid cash for our current home…I have a credit score of 740 or 750, but I am not the “breadwinner,” so I don’t think my credit will even count. What are the chances we would qualify for an FHA loan…(and) would the FHA look at our utility bill payment history instead of credit history?”
FHA rules state that non-traditional credit histories should be handled carefully by the lender, but non-traditional credit or a lack of credit history is not enough to disqualify a borrower from an FHA home loan.
“The lack of a credit history, or the borrower
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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