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FHA home loans are by far the most popular mortgage loans available. FHA stands for Federal Housing Administration and is a government agency. These FHA home loans are generally loans that are funded by a federally qualified lender, but are insured by the Federal Housing Administration. Although a FHA Home Loan is easier to get than a conventional mortgage loan there are certain qualifications for home loan . FHA home loans are so popular because they will allow you to finance your home purchase with having much less than the traditional twenty percent down. You can have as little as three and a half percent. This really allows more people to be able to own their own home.

Here are seven qualifications for home loan : One of the FHA Loan Requirements is that the home you purchase must be your place of residence. People who invest in a home to rent it out are not eligible for an FHA loan. There is also a maximum loan amount that is determined by the federal government. This amount is determined by assessing the costs of the area and the price ranges. In most cases, this type of loan has a loan to value ratio of 96.5% unless there is special circumstance in which a larger down payment is required.

Having a solid employment history is another one of the FHA Home Loan Qualifications. Whether you are an employee or are self employed, to qualify for an FHA loan you must usually maintain a job or line of work for 1-2 years. A diploma may be accepted instead of work history if the borrower is a recent graduate. Borrowers who are self employed must provide 2 years of tax returns as well as a profit and loss statement. The debt to income ratio of a borrower cannot be over 41% in order to meet the FHA Home Loan Qualifications. In some cases the government may allow up to 45%, especially if the debt is due to student loans.

FHA also requires the borrower to pay a down payment of 3.5% of the purchase price, unless there are special circumstances that may require a larger down payment. At closing, the seller can pay up to 6% of the closing costs for the borrower. Last but not least, an thorough inspection of the home is one of the very important FHA Home Loan Qualifications. The federal government has strict standards on what they consider a habitable place to live.

They do not need to have ton of money down and you don’t have to have absolutely perfect credit to qualify. So if you are looking to purchase a home and you are looking for a mortgage loan, your best chance is a FHA Home Loan because it is the FHA Loan Qualifications are more lenient than a conventional loan.

Learn more about Obama Mortgage Relief Plan Qualifications.

With so many people of America who are in debt it is easy to understand why the Government has programs to help individuals that are in need. People are charging everything from gas to groceries and it seems that the problem is not going to end soon. Most people don’t know that thousands upon thousands of home loan grants are given out each and every year, to people who are just like them. But hundreds of thousand of other people go without a grant, not knowing that they may be able to qualify for one – and better yet, get the money that they need to do what they’ve always wanted with their home.

What is a Home Equity Loan? Home equity loans are essentially second mortgages. These loans allow homeowners to borrow money using their home’s equity as collateral. For example, if a home is currently worth $200,000 and the amount owed to the lender is $150,000, the home’s equity is $50,000. Thus, the homeowner has the opportunity to borrow up to $50,000. A second loan is created, and the homeowner makes two monthly payments. One payment is applied toward the original mortgage and the second payment is applied to the second mortgage.

Group 1 – The first group of references is weighted more heavily than the second because it is considered a more accurate predictor of your credit worthiness. Group 1 consists of rental housing payments, utility payments (gas, electric, water). Also included are telephone, and cable TV bills. Group 2 – FHA qualifications are possible by including payment references such as: insurance payments (medical, auto, life, renters ins), payment to day care, internet cell phone, a 12 month bank documented history of deposits resulting in increased balance. Group 2 also accepts individual loans where the repayment terms are written out and signed by both parties.

FHA Rules for Non-Traditional Credit- To qualify for an FHA loan with non-traditional credit you should have 3 positive credit references and at least one being a group 1-credit reference. To be accepted under FHA qualifications you must display – in summary: No late payments on rental housing (group1). No more than 1- 30 day late on other payments (group1). No collection accounts (other than medical) in the last 12 months.

This is certainly good news for those that lack traditional credit references and trade lines with the credit bureaus. FHA recognizes that non-traditional credit applicants can display credit responsibility, manage mortgages, and pay their bills on time thus should not be denied a fair chance at homeownership. See the article below for all the details on group 2 credit references – as these are acceptable within certain guidelines for establishing a positive credit profile with FHA – enabling you to qualify for the home you thought was out of reach. It may be time to consider an FHA loan?

Learn more about Obama Mortgage Relief Plan Qualifications.