Mysest56 
March 1, 2022
The FHA is a sub-agency within the U.S. Department of Housing and Urban Development, or HUD, Which administers FHA-insured mortgage loans. An FHA loan is one that HUD agrees to purchase from the lender or mortgage company that issued the loan in case of a defaultoption. To qualify for FHA insurance that the lender must confirm the loan program meets all of HUD’s particular requirements.
Credit score
HUD is very generous with its own credit requirements for FHA mortgage loans. While conventional mortgages typically call for a good to excellent credit rating, FHA loans require only a recent history of superior credit irrespective of your credit rating. You can qualify for an FHA loan even if your credit rating is below 580. If your credit rating is higher than 580 you are able to qualify with a 3.5 percent down payment, however if your score is less than 580 you must provide at least a 10 percent down payment.
Credit History
Instead of relying upon your credit rating, HUD assesses your latest credit history to determine whether you can qualify for an FHA loan. The only real negative notes on your credit history that will block you from acceptance are a bankruptcy over the past two decades, an outstanding federal tax lien, or a few recent late payments even though you had adequate income to make the payments on time.
Debt to Income Ratio
HUD requires your income be sufficient to cover your monthly mortgage payments. Generally, this means your mortgage payment shouldn’t exceed 29 percent of your gross gross income. So, if you earn $2,000 per month then your mortgage payment must be less than $580 per month. Additionally, HUD requires your overall monthly payments on longterm debt, such as your mortgage, car payments, and student loans, cannot normally exceed 41 percent of your yearly income.
Mortgage Limits
The last need for HUD approval on an FHA loan is the mortgage loan must be less than the mortgage limitation in your town. HUD has established maximum loan amounts for every area in the USA. From the San Francisco Bay Area, for example, the mortgage limit for a single family home is 729,750 as of August 2010. The mortgage limits grow over time with inflation.