Connecticut FHA Home Loans

FHA Loans are a great resource for first time home buyers and seasoned buyers.  FHA offers more lenient underwriting guidelines than other loan types – which really helps borrowers to get the financing they need.  The other great thing about FHA is once you have a FHA Mortgage – you can always streamline (there are a few guidelines to follow) your refinance to lower the rate – and you don’t need an appraisal.

 

Here are some of the guidelines you need to be aware of when applying for a FHA Home Loan:

 

No Credit History

 

Three lines of credit are necessary to apply for an  FHA loan. However, in the event a borrower does not have sufficient credit on their credit report the FHA will allow substitute forms of history (example: cell phone bill).

 

Late Payments

 

During an underwriter analysis of borrower credit,  the overall pattern of credit behavior is being reviewed rather than isolated cases of slow payments. If a good payment pattern has been  maintained, regardless of a specific period of financial difficulty  preceded it, the borrower may escape disqualification.

 

Collection accounts

 

FHA does not require collection accounts to be paid off as a  condition of mortgage approval. However, FHA does recognize that  collection efforts by the creditor for unpaid collections could affect  the borrower’s ability to repay the mortgage.

 

  • If evidence of a payment arrangement is not available, the lender must calculate the  monthly payment using 5% of the outstanding balance of each collection, and include the monthly payment in the borrower’s debt-to-income ratio.

 

Chapter 7 Bankruptcy

 

At least two years must have elapsed since the  discharge date of the borrower and / or spouse’s Chapter 7 Bankruptcy,  according to FHA guidelines. This is not to be confused with the  bankruptcy  filing date. A full explanation will be required with the loan  application. In order to qualify for an FHA loan, the borrower must  qualify financially, have re-established good credit, and have a  stable job.

 

FHA is also one of the few programs that only requires 3.5% down on a purchase with a credit score 580 and up.  Call me today and lets talk about the FHA options you may be entitled to.

 

Thank you,

 

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Michael Meyer
Senior Vice President of Northeast Financial
NMLS#117875
Mike@northeast-mortgage.com
860-876-0572
210 S. Main St Middletown, CT 06457

Company NMLS#117273 

http://www.zillow.com/profile/MichaelMeyer8/

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Residential Clients: Click Here For Application

 

FHA Disclosure

 

NMLS# 117273, Northeast Financial, 860-788-7237

 

The principal and interest payment on a 203,500 30 year FHA fixed rate loan at 3.25% on 96.5% loan to value is 1,025.99 with 0 points due at closing.  The APR is 4.491%.  Payments include a one time upfront mortgage insurance premium (MIP) at 1.75% of the base loan amount and monthly MIP is calculated at .85% of the base loan amount.  The .85% monthly MIP is required for a specific period of time regardless of your down payment or equity in your home.  The principal, mortgage insurance, and interest payment does not include property taxes or home owner’s insurance premiums, which will result in a higher actual monthly payment.  Rates current as of 6/26/17