FHA Loan Problems, FHA Loan Solutions
Bankruptcy Issues
In many cases, if a borrower has worked on their credit and has fulfilled the bankruptcy terms, a simple waiting period of 24 months (sometimes 12, but those may be harder to be approved for) may clear the way for you to apply for an FHA mortgage.
FHA loan rules specify between 12 and 24 months of “seasoning” before you can apply for a new mortgage. Playing the waiting game can help in these cases but don’t forget to keep working on your credit.
The House Won’t Pass an FHA Appraisal
Have you considered buying that home with an FHA 203(k) rehabilitation loan and fixing it up instead? Ask your lender about this FHA loan option, also available as a refinance loan.
Trouble With the Down Payment
If you are buying existing construction and need help with your down payment, consider applying to a local down payment assistance program in your local area. That can help significantly reduce your out-of-pocket costs for the mortgage.
More Down Payment Issues
If you have a down payment gift, the lender must know exactly where those funds come from. If you know in advance that the lender requires documentation for all such assistance, you can avoid having your down payment funds rejected by the lender because they didn’t come from the right sources.
No payday loans, pink slip loans, credit card cash advances or similar sources may be used for your FHA loan down payment.
Income Verification Issues
If you traded salary for commission or started your own business, waiting until 24 months have passed while earning that type of income may get you closer to FHA loan approval. Applying soon after a major career alteration or income change may not work as well unless there are additional compensating factors.
When You Need a Second FHA Mortgage
FHA loan rules are designed to offer one FHA loan per applicant, but in cases where career changes or alterations in family size are a factor, there may be an exception.
You may be allowed to apply for another FHA mortgage even though the first one hasn’t been paid off yet if you can demonstrate a need for the exception to policy and the lender approves.
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