Home is the most loved place of majority of people. The reasons are the extreme comfort and freedom that a home offers to the owners. That is why people try to purchase homes even by slashing their family budgets. Most of the mortgage lenders require the borrower to pay 15 to 20 percent of the loan amount as down payment to approve the loan. This is a huge sum for most of the people and it is impossible to save such a big amount, especially in the current financial crisis. Yet there are some mortgage programs offered by FHA which will provide you all the money to purchase your dream home with out any down payment. This article is an attempt to provide with useful tips to qualify for FHA mortgage loan.

Getting approved for an FHA mortgage loan is not a tedious task. These loans offer great flexibility. Still, before sanctioning the loan, the lender will assess various factors to determine whether the applicant is the right candidate or not. One of the prime factors is the employment of the borrower. You should have been working contiguously at least for the past two years to get the approval. You have to keep in mind that, applicants who change employers frequently will have to struggle too much to get the loan approval. If you can prove that the unemployment was because of any legitimate reasons, you will be considered for the loan.

Another thing that the lender will consider while processing the application is the credit activity. Your credit activity for the past two or three years will be seriously scrutinized. You can not have more than two 30 days late payments within this period. If you have late payments of more than this limit, your application will simply be rejected. Further, bankruptcies must be more than two years old while the limit of foreclosures must be more than three years. With both the cases, the lender will make sure that you have done enough to rebuild your credit worthiness by improving credit rating.

While processing the mortgage, FHA will make an evaluation on both the combined income and overall debts. The combined income includes all the sources of income such as salary, incentives, income of other family members, other sources of money etc. This is to ensure that the loan amount does not go in excess of 30% of the total income. In the new financial situation, lenders are getting more and more liberal on such restrictions and sanctioning more money than this limit.

Thus an FHA loan offers many advantageous features which a borrower can take advantage of. These loans are ideal helping hands for people who can not afford to pay huge down payment initially.

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Tags: loans, mortgage, finance, mortgages, credit, fha mortgage loans