FHA Loan Credit Score

Purchase:

• 500 credit score with 10% down payment
• 580 credit score with 3.5% down payment
• No credit score with 3.5% down payment
• Down payment assistance available with a credit score of 620 or higher
• Gift funds accepted
• Seller concession (closing costs financed) allowed
• Non-occupant co-borrower allowed

Refinance:

• Minimum 500 credit score required
• 12 months of on-time mortgage payments
• 20% equity in the home after cashing out
• Revolving and installment late payments ok

Property Type:

• Single Family
• 2-4 Units
• Condo
• Townhouse
• Manufactured homes
• Mobile homes

What is the minimum FHA Loan Credit Score?

The minimum FHA loan credit score is 500. To purchase an owner occupied home, 10% down payment will be required with a credit score of 500 to 579. With a credit score of 580 or higher, the minimum down payment will be 3.5%.

Down payment assistance is available if the credit score is 620 or higher. There is no second lien or repayment required for the down payment assistance. With down payment assistance and seller concession, you can purchase a home with no money needed at closing. The only out of pocket expense will be the appraisal which usually costs around $500.

To qualify for a refinance, cash out or rate and term, the minimum credit score for FHA (Federal Housing Administration) required is 500. There must not be any late payments on the mortgage in the last 12 months and there must be at least 20% equity in the home after the refinance is complete.

What documents are required for an FHA loan?

To determine if a borrower qualifies income-wise, the most recent 30 days paystubs and last 2 years W2s will be required if the borrower works for an employer.

If the borrower is self-employed, the last 2 years tax returns will be required. If the borrower will be purchasing a home, they will need to provide the most recent 2 months bank statements to confirm they have enough funds to cover the down payment and the closing costs.

Written by: Chris Luis, loan officer for Mortgage-World.com

• Chris Luis covers mortgages and the housing market. Chris Luis has over 20 years experience in the mortgage industry.