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GUIDELINE BASICS FOR FHA
FHA Basics Complements of Platinum 1 Mortgage580 Minimum FICO Cash out. 530 Minimum FICO Purchase or Rate & Term (Underwriting Approved / Eligible for these minimum scores required.)
- Cash out 1 year in home required to use appraised value.
- To count part time income 2 years continuous required.
- Income like Social Security or Support is grossed up by 125% and needs to be verified that it will continue for at least 3 years.
- Adjustments to interest rates if loan is below $100,000.00 or FICO score is below 620, or loan needs to be manually underwritten.
- Wisconsin Properties only.
- 2 years out of Bankruptcy.
- Appraisal valid for up to 90 days.
- Offer to Purchase, Credit Bureau, and Loan Application all have to match.
- FHA requires Mortgage Insurance on any LTV 78% or higher.
- 97% LTV maximum on Purchase, 95% LTV maximum on refinance.
- 0 X 30 (NO Late Payments in last 12 months.)
- Must be Owner Occupied and requires full verification of income, including two most recent check stubs and two years tax returns with W2’s.
- Tax and Insurance escrows required no exceptions.
- 3 years out of previous foreclosure.
- Gift funds allowed, gift of equity is also allowed; in some cases; source needs to be verified, (from a bank account)
- Normal debt ratios 35% and 45% back end, some exceptions allowed.
- No seller seconds allowed. There never is a Pre-payment Penalty.
FHA IS NOT THE ONLY GAME IN TOWN! My Community 97, Home Possible 97, Flex 95 and 97, USDA Rural to 100% in qualified communities, Expanded Level 1, Level 2 and LP A-minus.
My Community 97 Loan
The Fannie Mae My Community 97 mortgage loan program allows borrowers to buy a home with a down payment as low as 3%. Similar to FHA the My Community 97 loan program has slightly less restrictive guidelines then FHA.
The My Community 97 Loan has been carrying higher interest rates than it originally did in the beginning. Another alternative would be Freddie Mac's Home Possible mortgage, with similar qualifying factors.
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