There is a reason why FHA Loans are the most popular loan program amongst borrowers and will be for the foreseeable future and it is due to the fact that they have some of the most lenient guidelines of any loan program available. Whether you are looking at FICO credit score requirements, down payments, or in our case the FHA Loan Debt To Income ratio, all these reasons will prove why FHA Loans are that popular. Nick Ferrante NMLS #1110570 at Mortgage Scenarios through Fairway Independent Mortgage Corporation NMLS#v2289 has come across plenty of borrowers who will only qualify for FHA Loans and he is more than happy to help you along with any other loan program you may qualify for. A lot of borrowers who we come into contact with already are familiar with their FICO credit score and know about the size of down payment they will need, but where they seem to get hung up on is the FHA Loan Debt To Income ratios needed for FHA Loans. This is why it is vital for borrowers to work with mortgage professionals such as Nick Ferrante NMLS# 1110570 that know all FHA Guidelines from the 4000.1 Handbook. Nick Ferrante is one of the best loan officers and mortgage professionals in the business and his goal is to keep everyone informed with the ultimate goal of getting loans approved and closed in a timely manner.
Unlike other loan programs that are available to borrowers, FHA Loans are a little different in the fact that they have different requirements for down payments and FHA Loan Debt To Income which all depend on the FICO credit score use to qualify the borrower. As you may or may not know the following FICO credit scores will determine down payments accordingly.
The FHA Loan Debt To Income ratios also have 2 different levels to them and they are:
As you can see your FICO credit score will have a large impact on your FHA Loan Debt To Income ratio so as with most debt purchases in life, the higher your FICO credit score, the better off you will be. Let’s take a look at how the FHA Loan Debt To Income ratio requirements can significantly impact the amount of debt you can carry when qualifying for a mortgage. Your debt to income ratio takes your monthly gross income and then divide your monthly debts into it which includes your proposed new housing payment.
So let’s say you make $72,000 per year or $6,000 gross monthly income, we can see how FHA Loan Debt To Income ratios will affect your purchasing power below:
In just this one example you will be able to absorb over $800 more monthly debt with a higher FICO credit score than you would with a lower FICO credit score. This all leads to a conclusion that it is necessary that your know the FHA Loan Debt To Income requirements or you will be met with reality if your FICO credit score isn’t the best it can be. This could lead you as a borrower to put your purchase on hold if you cannot get approved for the house you want under the lower debt to income ratio. Nick Ferrante NMLS# 1110570 of Mortgage Scenarios will take the time to work with you and put you in the proper mortgage given your specific situation. He have seen it all so no matter the scenario, he will always have an action plan with the goal of getting you approved! To apply with Nick Ferrante, please fill out the application here.