Some of you may be wondering if it is possible to get a Mortgage With Under 620 Credit Score and in this article we will go through just how it is possible for this to happen. Listen, it is almost 2nd nature that at some point in your life you are going to go through some hard times and the results will be seen in your credit history. Especially with the Great Recession of 2008, a lot of people have damaged their credit history, myself included. There are way more people these days with sub-700 credit scores and even lower than that who don’t know if they can qualify for a Mortgage With Under 620 Credit Score.
In order to qualify for a Mortgage With Under 620 Credit Score there is really only 1 loan program with which to get involved with and that is an FHA Loan. FHA Loans are the most popular in the United States and are not just reserved for first-time homebuyers. FHA Loans have some of the most lenient minimum requirements of any loan product out there. According to FHA’s minimum requirements you can have a 580 FICO credit score and still get approved for a 3.5% home purchase loan. You can even have a score between 500-579 and obtain a loan if you have a 10% down payment. Some other requirements that you will need to ensure you have besides a credit score this low is that your debt to income ratio is 43% or less if your FICO is under 620. Your debt to income ratio is your monthly debt obligations and your new mortgage payment divided by your monthly gross income. If there is a way you can get to a FICO score of 620+ your debt to income ratio can be as high as 56.9% which is a substantial increase from having a lower credit score.
For a Mortgage With Under 620 Credit Score you may also be required to show 12 months verification of rent or VOR. What needs to be shown is cancelled checks or evidence that you have made rent payments in a timely fashion over the previous 12 months. This is vital in showing the underwriter that you are responsible with your financial commitments. Another thing you will have to do if you are looking to obtain a Mortgage With Under 620 Credit Score is determine if you have satisfied the mandatory waiting periods for bankruptcies or foreclosures. For example if you had a Chapter 7 Bankruptcy you need to wait 2 years after the discharge date in order to obtain a mortgage while Chapter 13 requires no waiting period after discharge. If by chance you went through a foreclosure, that mandatory waiting period increases to 4 years. There is also waiting periods of 3 years for short sales and deed in lieu of foreclosure.
Besides the normal requirements for an FHA Loan, you also need to make sure you deal with a lender like myself because we do not have any lender overlays that will prevent you from getting a loan. Lender Overlays are additional requirements set by lenders that need to be satisfied in order to get a loan approval. Just because FHA says they can approve a loan with 580 FICO, most lenders will want you to have a 640+ FICO credit score. Is this fair, no, but it is allowed because lenders can determine exactly the amount of risk they are willing to take on a loan. If you have been denied in the past by a lender then please call me ASAP and we can get your loan started TODAY, 888-900-1020, email at firstname.lastname@example.org, or visit www.loanconsultants.org. Here a majority of our business is dealing with individuals who have suffered some credit setbacks and are looking to get back on their feet. Let it be known, we are here to help you and I will personally do everything in my power to get you approved and in the home you deserve.