FHA Loans

Down payment amounts for an FHA loan

Closing costs, down payments and other required monies can be gifted

Down payments, closing costs and other requirements can be met with gift funds.  A gift fund cannot be a borrowed and must not be required to be paid back.  A letter must be provided stating the relationship from the gift-or and may come from the following sources:

• A family member
  • Equity from a property can be gifted if one family member is selling a property to another family member
• Employer
• Close friend (must document the interest in the borrower)
• Charity
• Down payment assistance programs, government agency or a public entity that provides assistance
• Trade Equity can also be accounted for so long as it can be documented by acceptable sources
• Credits from real estate agents associated with the transaction or interested parties like the seller

FHA credit FICO requirements

FHA loans can be accepted with a minimum credit score of 500

A borrower must have a minimum  FICO of 580 to have qualify for an FHA mortgage with 3.5% down.  Lower credit scores may be accepted with a higher down payment.  Requirements become more stringent for borrower with a FICO lower than 580.  For example, borrowers with a credit score of 580 or higher are eligible for an FHA loan with a down payment of 3.5%.  Borrowers with a credit score lower than 580 may qualify, but need to put down at least 10% and other factors change as well.  Some lenders do accept a minimum credit score of 500.