Articles Tagged With: FHA Income Limits

July 7, 2020

How FHA Home Loan Limits Are Set

How does your lender know how much home loan to approve you for when you want to buy a home? Part of that process is learning the official FHA home loan limit in the housing market where you want to buy or build your home. The Federal Housing Administration sets FHA loan limits each year. There is a maximum FHA loan amount that is established in accordance with the National Housing Act. Five Things You Need To Know About FHA Loan Limits Five things you’ll need to remember about FHA purchase loan limits for suburban homes, condo units, having a house built for you on your own lot, etc. are: FHA mortgage loan limits vary by county; Loan limits may be exceeded if you are applying for an FHA Jumbo | more...

July 5, 2017

Who Are FHA Loans Good For?

By Bruce Reichstein

Who are FHA loans good for? It’s an excellent question and the answer might surprise you. FHA mortgages are often thought of as “helper loans” due to a misconception that FHA mortgages are specifically for first time home buyers, economically disadvantaged people, or new families. What’s the truth? FHA Loans Are Available To All Financially Qualified Applicants There is no minimum income limit OR “maximum income” cutoff for FHA home loans. A borrower cannot earn “too much money” and be disqualified as a result. FHA home loans are for anyone who meets the minimum FICO score requirements, has a reliable payment history on all financial obligations, and can show that their employment is stable and likely to continue. FHA Loans Are For All Types Of Borrowers Some mistakenly believe that | more...

June 22, 2017

What Is An FHA Loan And Who Qualifies?

By Bruce Reichstein

What is an FHA loan and who qualifies? These are common questions, especially for first-time home buyers looking at all their options from conventional mortgages to FHA loans. What Is An FHA Home Loan? Simply put, an FHA mortgage is a home loan that has been guaranteed by the government, making the mortgage safer for the lender and less expensive for the borrower. The FHA single family home loan program is designed for borrowers who are financially qualified with FICO scores at 580 or better for maximum financing. (Lender FICO score requirements may be higher than FHA minimums.) An FHA mortgage as described here is intended for owner-occupiers and is meant for primary residences. That means that time shares, vacation homes, and other occasional-occupancy properties cannot be purchased with an | more...

March 23, 2016

FHA Loan Questions: Employment Gaps

By Joe Wallace

We get many comments and questions about FHA home loan rules in our comments section. Here’s one of the most recent. “I have some money saved up, however I have not been employed for 2.5 years. I would like FHA loan if possible. My main issue is all my money is cash and not in the bank, and I have NO employment history for the past 2 years.” Basically it seems that the reader is asking whether an FHA loan is possible without a job. This is a complex issue-FHA loans permit the lender to consider public assistance, for example, as income. The source of income must be verifiable by the lender and deemed likely to continue. However, in the case of this reader question, there is no income at | more...

December 16, 2014

FHA Loan Income Requirements: A Reader Question

By Joe Wallace

A reader asks, “I would like to know how can I get a FHA Loan if my husband and me just make 40.000 a year. I went on bankruptcy in Oct 2011. Right now I have no debts, no car loans. I need an answer as soon as possible, we are living place to place, we paid rent on time,but living with more people is difficult. Also we have $10.000 for a downpayment.” FHA loan rules have no specific minimum income requirements for loan approval. FICO scores are used to approve the loan, as is your employment history and the likelihood of your current employment to continue. One of the most important things related to the borrower’s income isn’t the amount of that income, but rather how the income is | more...

June 27, 2014

FHA Loans For Schoolteachers: A Reader Question

By Joe Wallace

A reader asks, “My daughter is a schoolteacher. Where she lives, they do not give new hires full time jobs, but hire the teacher part time all the time so they do not have to give benefits. Can she get an FHA loan? Her total need would be $400,000 for the house less a 20% down payment, which she has. She has been working for a long time under this arrangement, but is not classified a a full time teacher. Her mother or I could co-sign for her if necessary. We are both retired but have verifiable incomes and property well in excess of the total loan amount.” FHA loan rules permit co-signers, non-occupying co-borrowers and other arrangements, so the answer to this question where that is concerned is that | more...

June 6, 2012

FHA Loans and Verifiable Income: Alimony, Child Support, and Maintenance Payments

By Joe Wallace

Borrowers applying for an FHA home loan have good reason to consider listing alimony, child support, and maintenance payment income on their loan applications. Not all wish to have this type of income included in their application data, but when accompanied by proper documentation and when verified by the lender, these types of “non-employment income” can be used to help calculate the borrower’s debt-to-income ratio for FHA loan approval. But what does the FHA require in order to verify and approve these income sources for the FHA loan? According to the FHA official site, “Alimony, child support, or maintenance income may be considered effective, if –payments are likely to be received consistently for the first three years of the mortgage –the borrower provides the required documentation” What does that documentation | more...

June 20, 2011

Can I Use Rental Income on My FHA Loan Application?

By Joe Wallace

An FHA loan applicant who owns a property he or she is currently renting would naturally want to include that income on the loan application. As with all other sources of income, the borrower must not only list the amount of that income, but also be able to show to the lender that the money is stable. Since an FHA lender is charged with verifying all sources of income, the borrower must provide proof that rent money coming in is likely to continue. What does the FHA require as proof of dependable income when it comes to rent payments? According to the FHA official site, “Examples of stability may include a current lease, an agreement to lease, or a rental history over the previous 24 months that is free of | more...

April 21, 2011

FHA Loans: Income Verification Facts

By Joe Wallace

Like many other loan products, FHA insured mortgage loans require