FHA loans with 580 score

[Wendell]

Can you still get an FHA loan with 580 credit score in 2012? My score is 595, and so I can’t go to Quicken loans… Thanks

[Tracy Winters]

Theoretically – Yes. Practically – No

Theoretically, a 580 Fico score should suffice, but in practice you’ll need A Fico of at least 620, if not 640 to be approved.

Although a Fico score of 580 is considered acceptable for an FHA, the FHA plan is just an insurance plan for lenders. It’s very difficult, if not impossible to actually find a lender willing to give you a loan with that score, and I’ve been hearing lately that actual approvals are now even higher, in the 640 area.

You need to keep in mind that credit scores are not everything. Credit reports play a big role, if not bigger than the scores themselves. If you do find a lender that is willing to approve you with your score, you will need to have a clean credit reports, with all derogatory items resolved!

You will also need to demonstrate:

• Minimum of 2 years stable work history
• Self resources to pay a significant down payment
• Low debt to income ratio
• Additional resources to pay closing costs

.

Hope this helps 🙂

[Author]

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