Articles Tagged With: Credit Check

July 17, 2018

FHA Home Loans And Your Credit Report: Know Your Rights

When you look for advice about getting approved for an FHA home loan, you will find that many encourage potential borrowers for FHA new purchase home loans and FHA cash out refinancing are urged to request a free annual credit report. Free credit reports are your legal right and you are entitled to one free credit report per year from each of the three major credit reporting agencies. Those agencies are TransUnion, Equifax, and Experian. But in addition to the right to a free annual credit report, did you know you have other rights under federal law that apply to your credit reports? All consumers in the United States have the legal right under federal law to contest inaccurate or incomplete information in your credit reports. This right is discussed | more...

July 16, 2018

Are Free Credit Reports Trustworthy?

By Joe Wallace

Long before you fill out FHA home loan application forms, you should be requesting copies of your credit reports and reviewing the information your lender will see when you are ready to get your new home loan. There are many websites and third-party companies that offer free credit reports to help loan applicants, but not all of them are interested just helping consumers. Can you trust the companies that offer free credit reports and credit score information? While it’s not possible to recommend a specific organization (with one exception), it is good for consumers to remember that many companies offer free services in exchange for your personal data that can be used to market goods and services to you via your cell phone number, email address, and other information. The | more...

July 9, 2018

Can I Get An FHA Loan With A Debt Collection In My Credit History?

By Joe Wallace

Can I get an FHA home loan approved even if I have a debt collection in my credit history? That is an important question on the minds of some FHA loan applicants going into the home loan process. This type of credit issue is commonly referred to as having a collection account, which HUD 4000.1 (the FHA Loan Handbook) defines as follows: “A Collection Account refers to a Borrower’s loan or debt that has been submitted to a collection agency by a creditor.” Collection accounts can be an issue for an FHA loan applicant; generally it is strongly recommended to come to the application process with 12 months of on-time payments for all financial obligations. Depending on circumstances (such as when the lender is required to manually underwrite the loan), | more...

July 3, 2018

Seven Facts About FHA Home Loans

By Joe Wallace

Seven facts about FHA home loans you should know include lower credit score requirements and down payments than conventional mortgage counterparts. The other five facts are just as useful to a house hunter as the low down payment and FHA credit score rules. FHA Home Loan Limits Are Adjusted Yearly And Vary Depending On The Housing Market Not all housing markets have the same costs or median house prices. A Zillow.com report for home values in 2018 says houses in California may average around $500,000 while homes in Pennsylvania average around $160,000. FHA home loan limits for high-cost and low-cost areas are adjusted rather than featuring an one-size-fits-all approach. FHA Loan Down Payment Requirements Compared To Conventional Mortgage Loan Requirements FHA loans specify down payment minimums between 3.5% of the | more...

June 22, 2018

Are There FHA Home Loans For Borrowers With No Credit?

By Bruce Reichstein

Are there FHA home loans available for borrowers who have no credit? Some home loan applicants may have little or no credit activity and worry that there may be no provisions in FHA loan rules for such circumstances. What does the FHA loan handbook, HUD 4000.1, say about this issue? FHA loan rules state that the lender is required to pull credit data for all FHA loan borrowers. Whether you need a new purchase home loan, an FHA One-Time Close construction loan, an FHA cash-out refinance loan or any other mortgage (except for an FHA Interest Rate Reduction Refinance Loan which has no FHA-required credit check requirements in most cases) a credit report will be pulled for each borrower obligated on the mortgage. In cases where the credit report shows | more...

June 12, 2018

Do You Suffer From Home Loan Anxiety?

By Joe Wallace

Do you suffer from home loan anxiety? There are many people who want to apply for an FHA mortgage loan, often first-time home buyers looking at an existing construction loan or an FHA One-Time Close construction loan, who begin to worry about getting their loan application approved. Are You Worried About Being Able To Afford Your FHA Mortgage? There is good news for those who are worried they might not be able to afford the FHA home loan and can’t decide whether or not to apply. But there are tools you can use to help get an estimate of how much your FHA mortgage payment might run every month in the form of online mortgage calculators. These tools ask you to input an estimated price of the home, potential down | more...

May 23, 2018

Common Credit Problems That Can Affect Your FHA Mortgage Loan Application

By Joe Wallace

What are the most common credit issues that may negatively affect your ability to get approved for an FHA home loan? There are several areas you can anticipate in the home loan planning stages; addressing these areas long before you apply for any major line of credit, including a home loan, goes a long way toward helping you get your new home. FHA Loan Credit Issues: On Time Payments The timely payments issue is one of the simplest areas to address, but also one of the most common problems going into a home loan application. In general, borrowers should never apply for a loan with any late or missed payments on their record in the 12 months leading up to the loan paperwork. Anything less than this can seriously compromise | more...

May 14, 2018

FHA Home Loan Approval And Your Credit Report

By Bruce Reichstein

What do potential home loan borrowers need to know about FHA loans and credit reports? There are some very simple things that some don’t realize going into the home loan process that can definitely affect your participating FHA lender’s ability to approve your mortgage. FHA Loan Credit Checks The lender is required by FHA home loan rules to pull a loan applicant’s credit reports to review credit scores, credit history, and look for overall patterns of reliable use of credit. However, some borrowers mistakenly assume that the lender will look at a credit report once, make the notes, and never go back to the credit report again. This is not necessarily the case. Your FHA lender is charged with making sure that a borrower’s credit position is stable and that | more...

May 14, 2018

Am I Eligible For An FHA Home Loan If I Am In A Credit Counseling Program?

By Joe Wallace

Are potential FHA borrowers eligible for an FHA home loan if they are participating in a credit counseling program? This is a question on the minds of some borrowers trying to fix credit issues and repair past mistakes or problems associated with their credit. Borrowers should always work on their credit, counseling program or not, before applying for any major line of credit such as a mortgage or auto loan. The FHA and HUD even offer referrals to local, HUD-approved housing counselors for borrowers looking for pre-purchase advice including credit tips. (You can call the FHA directly at their toll-free number, 1-800 CALL FHA for these referrals). Some borrowers choose a formal credit counseling program in order to work on credit repair issues, and there is an understandable concern that | more...

February 26, 2018

FHA Loans, Credit Reports, And Loan Approval

By Bruce Reichstein

What do you need to know about FHA loans, credit reports, and loan approval? To begin, your credit reports have a big part to play in the lender’s decision to approve your mortgage application. What do you need to know about this approval process and what the lender is looking for? Home Loans Require More Than Good Credit Scores FHA loans, like any other major line of credit, require the lender to determine that the applicant is a good risk for the loan. Your FICO scores may be well within the range the lender needs to approve your loan with maximum financing (that score may vary depending on the lender) but what ELSE does your credit report say? For example, are you carrying the maximum or close to the maximum | more...