Bad Credit Home Loan Florida Mortgage Guidelines

This Article Is About Bad Credit Home Loan Florida Mortgage Guidelines

The real estate market in the state of Florida is hot.

  • Home prices in every county in Florida is appreciating and there is more demand for Florida homes than there are homes in the market
  • Florida home buyers can qualify for Bad Credit Home Loan Florida with FHA Loan programs
  • Borrowers do not have to pay off outstanding collections and charge off accounts to qualify for FHA Loans
  • I run into many case scenarios that might help my readers

In this article, we will discuss and cover Bad Credit Home Loan Florida Mortgage Guidelines.

Recent Mortgage Case Scenario

Let’s take this case scenario.

  • Mike Jones got married to Robin Jones
  • Mike owns a house and Robin moved in with Mike when they got married in June 2005
  • Everything went well for both Mike and Robin until August 2008
  • Both Mike and Robin lost their jobs
  • Their unemployment was a fraction of the income they both made
  • They soon were getting behind on their mortgage payments
  • Long story short, the Jones’s voluntarily turned in their keys to the lender and got foreclosed on March 2011
  • Both Mike and Robin got new jobs and are making a stable income
  • They have 580 credit scores
  • They have one secured credit card and pay everything in cash
  • They both several credit cards that have been charged off and a few collection accounts

In the above case scenario, Mike and Robin will qualify for an FHA Loan with not needing to pay off their outstanding collection accounts and charge-offs.

Bad Credit Home Loan Florida Mortgage Lenders

 

Robin went to several different lenders and was told that she does not qualify for an FHA Loan:

  • This was because she did not have a 620 FICO credit score
  • Needed to pay off her outstanding collection accounts and charge off accounts
  • She went to another lender
  • She was told that she would not qualify for an FHA Loan

This was because she does not have a 640 credit score.

Lender Overlays On Credit Scores

Lender Overlays On Credit Scores

Why is she being told different credit score requirements by the lenders?

  • Lenders have lender overlays in underwriting on FHA Loans
  • Just because borrowers meet HUD Guidelines on credit scores does not mean the lender will qualify and approve them
  • FHA Guidelines On Credit Scores is borrowers can have 580 FICO Credit Scores and qualify for 3.5% down payment home purchase FHA Loan
  • However, most lenders will require higher credit scores than those required by FHA
  • This is called lender overlays on credit scores
  • Same will collections and charge off accounts
  • FHA does not require borrowers to pay off the outstanding collection and charge off accounts
  • However, lenders can have overlays on the outstanding collection and charge off accounts where they will require them to pay them off in order for them to do the loan
  • Gustan Cho Associates has no lender overlays on FHA Loans

Homebuyers can qualify for FHA Bad Credit Home Loan Florida with 580 credit scores and do not need to pay off outstanding collections and charge offs.

Bad Credit Home Loan Florida With No Waiting Period After Bankruptcy And Foreclosure

Home Buyers who need to get qualified for Bad Credit Home Loan Florida with prior bankruptcy and foreclosure can qualify for a home mortgage with no waiting period with our new NON-QM Loans.

Here are NON-QM Mortgage Loan Program Requirements:

  • No Waiting Period After Bankruptcy and Foreclosure
  • Bank Statement Mortgage Loan Program for self-employed borrowers
  • No Doc Fix And Flip Loans
  • No Doc Investment Property Loans

Qualifying For Traditional Loans After Bankruptcy And Foreclosure

Robin found out that I specialized in bad credit home loans through one of my clients and called me when they can qualify for a mortgage.

  • She heard that there was a waiting period for homeowners who had a foreclosure on their record
  • I told her to submit an online mortgage application via my website and she did so
  • I ran both Mike and Robin’s credit and found out that foreclosure was only on Mike Jones’s credit report only and not Robin’s

I inquired about the foreclosure and found out that Mike had owned the foreclosed home prior to marrying Robin:

  • Did not meet the mandatory waiting period to qualify for an FHA Loan after foreclosure

Robin made sufficient income where we were able to just put her on the FHA Loan and both Mike and Robin can be put on the title:

There are waiting period requirements to qualify for government and conventional loans after Bankruptcy and Foreclosure.

Waiting Period After Bankruptcy And Foreclosure

What is the waiting period after bankruptcy and exclusion

There is a two-year waiting period to qualify for FHA Loans after the Chapter 7 Bankruptcy discharged date:

  • Homebuyers can qualify for FHA Loans one year into a Chapter 13 Bankruptcy repayment plan
  • There is no waiting period to qualify for FHA Loans after the Chapter 13 Bankruptcy discharged date
  • There is no waiting period to qualify for FHA Loans after Chapter 13 Dismissal Date
  • There is a four-year waiting period to qualify for Conventional Loans after the Chapter 7 Bankruptcy discharged date
  • There is a two-year waiting period to qualify for Conventional Loans after the Chapter 13 Bankruptcy discharged date
  • There is a four-year waiting period to qualify for Conventional Loans after the Chapter 13 dismissal date
  • There is a three-year waiting period to qualify for FHA Loans after the recorded date of foreclosure and/or deed in lieu of foreclosure and the short sale date of a short sale
  • There is a four-year waiting period to qualify for Conventional Loans after the recorded date of a deed in lieu of foreclosure or short sale date of a home
  • There is a seven-year waiting period to qualify for Conventional Loans after a recorded date of a standard foreclosure
  • There is a four-year waiting period to qualify for a Conventional Loan after the discharged date of a Chapter 7 Bankruptcy if they had a mortgage or mortgages part of their Chapter 7 Bankruptcy discharge
  • However, the transfer of title need to have happened with a short sale, deed in lieu, or foreclosure once the mortgage or mortgages were part of the Chapter 7 Bankruptcy

The four-year waiting period starts from the discharged date of the Chapter 7 Bankruptcy.

Getting Qualified For Bad Credit Home Loan Florida

In a case like this, Robin qualified for a new home purchase loan but not Mike.

  • I suggested that Robin try to qualify for the mortgage by herself and add Mike to the title
  • After running Robin’s credit and income, Robin qualifies for the mortgage
  • Both Mike and Robin decided to take this route and buy a new home

If you are in a similar situation like Mike and Robin, you too can qualify for a bad credit home loan Florida.  Please contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Homebuyers can also email us at [email protected] The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays to take mortgage inquiries and go over case scenarios.

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