FHA Loans In Chicago With No Lender Overlays

This BLOG On FHA Loans In Chicago With No Lender Overlays Was Written By Gustan Cho

Many borrowers have a hard time finding a lender who specializes in FHA Loans In Chicago With No Lender Overlays. A mortgage borrower with over 740 FICO Credit Scores, low debt to income ratio, long term on the same job, no outstanding collection accounts, no outstanding charge off accounts, no judgments, and no tax liens with a perfect credit payment history can get qualified and approved at any mortgage company. However, life does not work that way. The Gustan Cho Team are experts in closing FHA Loans In Chicago With No Lender Overlays. Many hard working families with the best of intentions have gone through financial hardship through one or more of the types of extenuating circumstances below:

  • Fell victim of the Major Recession of 2008
  • Lost their business
  • Lost their jobs
  • Lost their homes and had a foreclosure, deed in lieu of foreclosure, short sale
  • Had to file Chapter 7 or Chapter 13 Bankruptcy
  • Have current employment where they are overqualified for the position they are working
  • Had to go through divorce
  • Had medical issues or a member of their family had medical issues
  • Lost their savings and investments due to the economy

There are many instances where consumers end up with bad credit because of unseen circumstances and not because they are financially responsible. These borrowers need lenders who specialize in FHA Loans In Chicago With No Lender Overlays when it comes to qualifying for a home loan in Chicago or its suburbs.  Eventually, hard working Americans do not give up and recover. The great part of FHA Loans is that FHA understands that people do go through hard times and that they do recover and do deserve a second chance in life and deserve an opportunity to become homeowners. Chicago, Illinois and the Chicago Suburbs of Illinois was one of the greatest hit areas due to the 2008 Great Recession and many Chicagoans have still not recovered from the longest lasting recession in the history of the United States. To make matters worse for Chicago and its surrounding suburbs, home prices have been skyrocketing. Chicago and its surrounding Counties is considered a high cost area under the eyes of the United States Department of Housing and Urban Development, HUD, which is the parent of the Federal Housing Administration, FHA. Chicago FHA Borrowers who have had prior credit issues or have higher debt to income ratios needs to consult with Chicago FHA Lenders who specialize in FHA Loans In Chicago With No Lender Overlays. The Gustan Cho Team are experts in FHA Loans In Chicago With No Lender Overlays.

What Are FHA Lender Overlays

The mortgage business is a private industry and mortgage lenders do not have to adhere to the minimum FHA Guidelines. Mortgage Lenders do have to follow the minimum FHA Guidelines set by HUD but they can have higher FHA Mortgage Lending Standards that surpass the minimum Guidelines set by the Federal Housing Administration or FHA.  The Gustan Cho Team are experts in originating and closing FHA Loans In Chicago With No Lender Overlays

Here are the basic 2017 FHA Guidelines to qualify for FHA Loans:

  • FHA GUIDELINES:  3.5% minimum down payment
  • FHA LENDERS WITH OVERLAYS:  Many lenders will require 5% down payment on a home purchase with a FHA Loan if the borrower has lower than 620 credit scores
  • FHA GUIDELINES:  To qualify for a FHA Loan with a 3.5% down payment, the borrower needs at least a 580 Credit Score
  • FHA LENDERS WITH OVERLAYS: Most mortgage lenders have minimum credit score requirements of 640 Credit Scores or 620 Credit Score Requirements
  • FHA GUIDELINES:  FHA borrowers can qualify for a FHA Loan with credit scores between 500 FICO and 579 FICO BUT need to put a 10% down payment
  • FHA LENDERS WITH OVERLAYS: Most FHA mortgage lenders will not touch any borrowers with under 580 FICO Credit Scores
  • FHA GUIDELINES:  Maximum debt to income ratio is capped at 43% if your credit scores are under 620 Credit Score
  • FHA LENDERS WITH OVERLAYS: Common FHA Lender Overlays include front end debt to income ratio requirements of 31% DTI and 3 credit tradelines that has been seasoned for at least 12 to 24 months with no late payments. There are some FHA Lenders, normally smaller lenders that will classify under 620 Credit Score Borrowers as Low FICO Borrowers and may even include the spouse’s debt as well as require verification of rent. If you have lenders that require a lot of additonal conditions just because you have under 620 FICO Scores, contact The Gustan Cho Team at Cross Country Mortgage at 262-878-1965 or call or text Gustan Cho directly on his cell at 262-716-8151 or email us at gcho@gustancho.com
  • FHA GUIDELINES:  Maximum back end debt to income ratio is capped at 56.9% and front end debt to income ratio is capped at 46.9% if the borrower has at least a 620 FICO credit score to get an approve/eligible per Automated Underwriting System
  • FHA LENDERS WITH OVERLAYS: Common lender overlays imposed by lenders include capping debt to income ratios at 45% to 50% DTI
  • FHA GUIDELINES:  You do not have to payoff outstanding collection or charge off accounts to qualify for a FHA Loan
  • FHA LENDERS WITH OVERLAYS: Common lender overlays are that lenders will require you to pay off outstanding collection accounts and/or charge off accounts. Some lenders may have maximum caps on collections and charge offs
  • FHA GUIDELINES:  You can qualify for FHA Loans after bankruptcy and foreclosure. There is a two year waiting period to qualify for a FHA Loan after a Chapter 7 Bankruptcy discharged date
  • FHA LENDERS WITH OVERLAYS: Common overlays includes having no late payments after bankruptcy and minimum of 3 credit tradelines that has been seasoned for 12 to 36 months
  • FHA GUIDELINES: You can qualify for a FHA insured mortgage loan one year into a Chapter 13 Bankruptcy Repayment Plan with the approval of the Bankruptcy Trustee via a manual underwrite
  • FHA LENDERS WITH OVERLAYS: Common FHA Lender Overlays on the above guideline is that many FHA lenders do not do manual underwriting and will not accept borrowers who are either in a Chapter 13 Bankruptcy Repayment Plan or borrowers who does not have at least a two year seasoning after the discharged date of the Chapter 13 Bankruptcy. The Gustan Cho Team has no FHA Lender Overlays and can do FHA Loans during and after a Chapter 13 Bankruptcy discharged date with no waiting period
  • FHA GUIDELINES:  You can qualify for a FHA Loan with no waiting period after a Chapter 13 Bankruptcy discharged date
  • FHA LENDERS WITH OVERLAYS: Common FHA Lender Overlays is that the lender may require one year to a two year waiting period after a Chapter 13 Bankruptcy discharged date
  • FHA GUIDELINES:  You can qualify for a FHA Loan after a foreclosure, deed in lieu of foreclosure, or short sale after three years of the recorded date of the deed in lieu and/or foreclosure or the recorded date of the short sale
  • FHA LENDERS WITH OVERLAYS: Common Lender Overlays includes where no late payments after a significant housing event and minimum 3 to 5 credit tradelines that has been seasoned for 12 to 36 months 
  • FHA GUIDELINES:  You can qualify for a FHA Loan 12 months after a Loan Modification
  • FHA LENDERS WITH OVERLAYS:  Common Lender Overlays includes a two to four year waiting period after a loan modification
  • FHA GUIDELINES:  You can qualify for a FHA Loan After A Timeshare Foreclosure with no waiting period. FHA does not consider timeshares as real estate and considers timeshare as a consumer loan
  • FHA LENDERS WITH OVERLAYS:  Common overlays is that even though FHA does not consider timeshare foreclosures a real estate foreclosure, either some lenders do not know the guidelines or do not want to deal with any borrowers with timeshare foreclosures

How Do I Find A Lender That Specializes In FHA Loans In Chicago With No Lender Overlays

The Gustan Cho Team are experts in originating and closing FHA Loans In Chicago With No Lender Overlays in 30 days or less. If you are looking for a 5 star mortgage team who can not just can help you with FHA Loans In Chicago With No Lender Overlays but who are able to close your FHA Loans In Chicago With No Lender Overlays on time, please contact The Gustan Cho Team:

Gustan Cho NMLS 873293

Email: gcho@gustancho.com

Direct: 1-262-878-1965

Cell: 262-716-8151 Please Text For Faster Response With Contact Information Including Email Address. 

Available 7 days a week, evenings, weekends, and holidays to take calls from 50 states

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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