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 FHA is now going to a 640+ credit score.... View next topic
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kuuner
Cherry Bomb


Joined: 13 Feb 2008
Posts: 182

Re: FHA is now going to a 640+ credit score....
PostPosted: Fri Jul 31, 2009 1:37 am Reply with quoteBack to top

Freedom Mortgage but only for refinances and First Mortgage but only with no derogs within the last 12 months on credit. Difficult considering under 620 would IMPLY recent derogs. Also, I'd rather sever my arm at a joint with a bleeding major vein than do a loan with First Mortgage.
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FromPlattoPlace
Flash in the pan


Joined: 02 Jul 2009
Posts: 42

Re: FHA is now going to a 640+ credit score....
PostPosted: Wed Aug 05, 2009 3:15 pm Reply with quoteBack to top

As far as ive seen lately, even folks with 630+ are too toxic to underwrite lately.. no one i can find will touch them.
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kuuner
Cherry Bomb


Joined: 13 Feb 2008
Posts: 182

Re: FHA is now going to a 640+ credit score....
PostPosted: Thu Aug 06, 2009 1:05 pm Reply with quoteBack to top

FromPlattoPlace wrote:
As far as ive seen lately, even folks with 630+ are too toxic to underwrite lately.. no one i can find will touch them.


You aren't looking hard then. Most FHA lenders out there take 620 and above. You have other issues on your file if it is 630+ and deemed, "Toxic" to an underwriter. I mentioned previously two lenders specifically that go under 620.
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FixUrRate
Flash in the pan


Joined: 27 Aug 2008
Posts: 63
Location: NY

Re: FHA is now going to a 640+ credit score....
PostPosted: Fri Sep 11, 2009 6:03 am Reply with quoteBack to top

kuuner wrote:
Freedom Mortgage but only for refinances and First Mortgage but only with no derogs within the last 12 months on credit. Difficult considering under 620 would IMPLY recent derogs. Also, I'd rather sever my arm at a joint with a bleeding major vein than do a loan with First Mortgage.
Freedom will not manual these files, they still require AUS approval. Anyhow, good luck closing a loan with Freedom Mortgage, BUT if it does close, be prepared to wait 120 days and get re-stipped every two weeksfor updated documents because the previous ones have expired.
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jarcher
Dud?


Joined: 10 Oct 2009
Posts: 3
Location: California

FHA to 600 - Streamlines with No Credit Report
PostPosted: Sat Oct 10, 2009 3:03 pm Reply with quoteBack to top

What I feel you will see out there is a pricing adjustment similar to agency. The closer the score approaches 600 (in our case) the higher the price adjustment is set to risk base price for the score.
Currently our company is able to offer two FHA programs providing options presently not seen in abundance.
Try the FHA Streamline for those with at least 6 months of payments on the books with a currently financed FHA loan. For those with scores not able to qualify under the standard full credit qualifying 620+ score FHA streamline you see most often in the market, this NON CREDIT QUALIFYING program is available to them. Basically one can look at it as a mortgage only program. Pay your mortgage 0 x 30 and away you go. No INCOME, No ASSETS and No LIABILITIES are listed (except in states with income disclosure laws in place). Employment is verified to be consistent the employment used to qualify the existing FHA financing. The main benefit to this program is there is NO CREDIT REPORT provided. SCORES ARE NOT PROVIDED. The mortgage history with FHA drives this loan for credit decision.
The second program is perfect for purchases. We have a FHA program allowing only a 600 score to qualify. Yes, credit still must comply with good pay histories and ratios, but it allows sellers to offset the cost of the low score adjustment keeping the rate at attractive levels. The borrower wins with a good rate and is able to qualify for a FHA loan where most lenders have minimum scores of 620 or now rumoring 640 to qualify.

_________________
-----------------------------------
Joe Archer - Branch Manager
Pacific Union Financial
714-380-6992 ph. / jarcher@loanpacific.com
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FromPlattoPlace
Flash in the pan


Joined: 02 Jul 2009
Posts: 42

Re: FHA is now going to a 640+ credit score....
PostPosted: Tue Oct 13, 2009 2:14 pm Reply with quoteBack to top

Instead of having people bulk their scores up to qualify and then letting everything go back to pot after the sale..

You would think they could simply have a product that is variable interest based on your average credit score for the previous 6 months..

The score adjusts bi-annually based upon your current risk.. keep your poo poo together for 30 years, pay less. Start slipping, pay more..
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PoolinMBS
Flash in the pan


Joined: 03 Apr 2009
Posts: 35
Location: NYC

Re: FHA is now going to a 640+ credit score....
PostPosted: Wed Oct 28, 2009 6:37 pm Reply with quoteBack to top

PoolinMBS wrote:
amabo wrote:
PoolinMBS just curious on how you are able to write down to a 500 and then for how much longer?

FNMA seller/servicer
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Credit Yoda
Dud?


Joined: 20 Oct 2009
Posts: 13
Location: Nationwide

Re: FHA is now going to a 640+ credit score....
PostPosted: Mon Nov 02, 2009 3:52 am Reply with quoteBack to top

What has not been addressed is how credit scores can be improved in a short amount of time with the right guidance. I've read through many threads on the minimum credit score requirement for FHA, but nothing is being said about assisting the client to improve the credit to qualify.

Instead of seeking out the lenders that will do sub 620 FHA, fill out broker packages for them, or find a pass through, etc... why not help the client get their scores up?

Sub 620 lenders like Freedom make the client pay a rate premium for the lower scores, which push up debt ratios, which decrease your margins for approval.

The path of least resistance is to work on the problem, not seek out a solution that is much less attractive.

You clients will appreciate the fact that you took the time to go the extra mile, and not just go back to them and offer a higher rate.
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