FHA mortgages allow for all special circumstances when deciding if a borrower should qualify. FHA underwriters look at what we call “compensating factors”. These “factors” can offset some credit problems you may have had in the past. Some of the factors include but are not limited to:

• Loan to Value- the lower the loan to value of you situation the better (this means what your home is worth vs. what you are borrowing)

• Employment time- when and underwriter sees that you have been on your job for 5+ years, then the FHA underwriter sees stability and this is very important!

• Reserves- FHA underwriters love to see you having a lot of reserves, and by reserves we mean: cash in the bank, liquid assets such as stocks, bonds, 401K, etc…FHA underwriters like to know that if you run into hard times that you could draw on this money in order to make your payments.

• Lowering your payment- when your payment is going down, that is a really good situation. FHA underwriters love this. They also like when your payment only goes up by 10% or less.

If your credit situation is down, remember that doesn’t mean that you do not qualify for an FHA loan, it just means that a full analysis of your situation must be done in order to see if you could qualify for an FHA loan. Remember, FHA (Federal Housing Authority) was created to help people with special circumstances and in the advent of the sub prime meltdown FHA is coming around again.

Always look at FHA as an option before going sub prime. Sub prime loans should be a last ditch effort, FHA can give you everything that a conventional loan can do even if you don’t necessarily qualify for a conventional loan. Please email me at anytime and I will be happy to answer any questions that you have regarding FHA mortgages, jonofrio@whatisyourrate.com, and if i don’t know the answer, which does happen then I will find out from my FHA underwriter. She has 25+ years experience underwriting FHA loans, so we have all of the information you could possibly ever need.

Thanks for checking in and please don’t hesitate to contact me!

Jeff Onofrio Branch Manager- 866.596.7843 www.whatisYourRate.com