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FHA home loans are US government-insured mortgages, most notably the Federal Housing Administration. FHA itself does not make the loans. What they do is they provide the loans made by their qualified group of commercial lenders.
With the introduction of the Texas FHA loan programs, many low-income Americans were able to get a loan to buy their homes. FHA home loans are conceptualized in the 1930s at the time of the Great Depression. The government has acted to subsidize loan programs through the FHA in response to the rising rate of default and foreclosures.
The good news is that FHA is for every American. But they must follow the guidelines set to apply it. To find out if you qualify for an FHA home loan, here is a checklist that you can use. See for yourself if you can take advantage of the FHA’s easy mortgage plans.
- First and foremost, you should have a stable employment history. By this you should be able to prove to the agency that you have at least two years of service with your current employer. Stability of work and income is the main factor. This is the first requirement of the Texas FHA loan programs.
- You should have a growing income, or at least a constant result. In order for the FHA to properly assess your ability to pay, you should show them that in your current job, you earn a fixed amount. And if, in case that’s not the case, your income should follow a steady upward pattern, not fluctuating.
- You should brag about your credit history. Your credit report definitely tells you a lot about your financial situation. It is the requirement of the FHA that all its candidates are in good credit. And not only that, they also require that there is not a single payment due for more than a month in the last two years in their credit reports.
- You should also show that you have no bankruptcy history. Or even if you had it, it should be at least two years ago. You should also show that you have already regained financial stability in the last two years. You should have good credit for two consecutive years.
- Your seizures, if any, should be at least three years old. It follows the same principle as the bankruptcy rule set out above. It’s a must that, for three years, what you have is good credit.
- You can only request a loan representing 30% of your total monthly income. If you have everything else worked out, remember this important detail: FHA will approve a loan for your gross income. So, do not submit a request for a 30% overflow. Your request will simply be rejected. Look and install a house that is just within the limits.
These are the different points to consider when applying for an FHA loan. You should qualify in each step indicated here. These are the exact guidelines that FHA currently follows.
But you must know that pre-qualifying for the loan is only the first step. This is not a guarantee of anything. All that means is that the FHA deserves a review of your application and proceed from there. Your dream of buying the perfect home is still in the cooking phase, so to speak.
Prequalification is however the first step to get a loan. Needless to say, this is an important step. If you do not pass the pre-qualification phase, it is impossible to buy the house you have always wanted, at least not by the FHA.
What the pre-qualification process really does is evaluate your income, assets and ability to pay. After that, you have to show it to the lender who is waiting on the wings. Then they study your case more. You will get the loan once you see that you are actually financially stable.
With all that said, go ahead and start evaluating yourself for an Texas FHA loan programs. Enjoy what they offer today. It’s your chance to own the house of your dreams. Take it while it is still there.