FHA Credit Guidelines

FHA Credit Guidelines

Your credit score must meet certain guidelines for all FHA mortgages. There are some streamline refinances that may not require a credit check. Currently, potential borrowers with a credit score lower than 500 are not eligible for an FHA loan.

To qualify, the FHA requires a minimum credit score of between 500 and 580 for borrower to be eligible for a mortgage with a maximum of a 90% loan-to-value for the property. If you have a 580 credit score or higher the FHA maximum increases to 96.5% loan-to-value.

Non-Traditional Credit:

Not everyone has a credit history. Non-traditional credit is used when the borrower does not have any prior credit history. Having very little credit history can also qualify.

A non-traditional credit through the FHA would require at least three letters from any repeated monthly obligation such as rent, utilities, store accounts, cell phone accounts, and/or any other acceptable sources.


Court ordered judgments must be paid completely unless the borrower has been making regular and timely payments and the creditor is willing to subordinate that judgment to the new insured mortgage. The borrower must provide a satisfactory written explanation.


Handled on a case-by-case basis.


Require a minimum of three years since the completion of the action and the borrower must have re-established good credit.

Delinquency or Default on Federal Debt:

If the borrower is presently delinquent on any federal debt or is obligated on any type of federal lien, he or she is not eligible for an FHA loan until the delinquent account is brought current, paid, or otherwise satisfied, or a satisfactory repayment plan is made between the borrower and the federal agency owed and is verified in writing.


-Chapter 7 requires a minimum two-year lapse period since discharge date; minimum one-year lapse period may be acceptable if bankruptcy was caused by extenuating circumstances that are not likely to recur the reason can not be debt caused by uneducated choices. Only extenuating circumstances will be considered and only after one year has passed. In all cases the borrower must have re-established credit and must demonstrate the ability to manage financial affairs.

-Chapter 13 is permitted if a one-year payout period has elapsed and performance has been satisfactory. The borrower must receive court approval to enter into the mortgage transaction.