How to Qualify: FHA Home Mortgage Loan in Temecula-Murrieta-Menifee

Qualifying for a Temecula/Murrieta/Menifee FHA Mortgage is not as difficult as you might think.  It starts by gathering the common pre-approval documentation that will be needed by the Loan Officer to complete your loan application and structure your file properly. 

The three primary criteria that determine if you qualify for a Temecula/Murrieta/Menifee FHA mortgage, and for how much, are these three things:

Debt-to-Income Ratio (DTI) –  This helps the lender determine how much you can qualify for or afford.  Click through to this link to read more about what is a DTI ratio.  Qualifying income for hourly paid employees is the base income over a 24 month average.  For salaried employees, they will commonly use the current pay rate.  For overtime and bonus income to count as qualifying income, there must be a 24 month history and be expected to continue.  A verification of income will be requested through your HR or payroll department to break out the pay history.

Loan-to-Value (LTV) – To qualify for a Temecula/Murrieta/Menifee FHA home mortgage, you will need a down payment of 3.5%.  This results in a minimum LTV of 96.5% for an FHA loan.  This money needs to come from your sourced and seasoned documented funds (not a loan from a VISA card or buddy).  FHA allows for family member to give a gift for the entire down payment, but you need to document the gift money the right way.  You can always make a larger down payment but I think it’smore importnant to keep any extra money liquid in your bank account for emergencies.

P.S. If you do not have the full 3.5% down payment saved up, I may be able to get you approved for a Temecula/Murrieta/Menifee Down Payment Assistance Grant that never has to be repaid!

FICO Credit Score & History –  A credit score is what lenders use to determine the risk associated with your ability or willingness to repay debt….or at least not default.  It’s important to know that when some lender tells you the FHA minimum FICO score is 620 or 640 that they are flat out lying to you.  FHA has no actual minimum.  They are telling you what their company’s minimum score is.  Because I am both a direct lender and broker, I can broker your loan to 2-3 different lenders who will approve Temecula/Murrieta/Menifee FHA Mortgage loans under 620 FICO score. If you want to find out what your FICO credit score, the best place is MyFICO credit score.

If you skimmed the article and just want to find out if and/or how much you qualify for, I would be happy to discuss how to get started.  Shoot me an email brad (at) homeloanartist (dot) com or call direct (951) 215-6119.  I’m here to help….it’s my job:-)

P.S. If you don’t qualify due to a low FICO credit score, recent short sale, bankruptcy, or foreclosure in the the last 3 years, call me anyways.  I have some ideas on how to boost your score an extra 30-50 points and qualifying guidelines may be loosening up allowing you to purchase sooner than expected.

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3 Responses to How to Qualify: FHA Home Mortgage Loan in Temecula-Murrieta-Menifee

  1. Julius Nyanda February 3, 2011 at 2:38 am #

    I left a comment on the flip post, but that 580 and even the 540 rumor is crazy. Have you heard?

  2. Brad Yzermans February 3, 2011 at 3:03 am #

    Yes, I can do loans below 620 to 580…and even lower but the fees and rates are very high and anything below 580 requires a 10% down payment per FHA’s new guidelines. Makes more sense to work on improving and rebuilding credit than take on a higher rate, higher fee FHA loan.


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