Real Living Mortgage (a division of Wells Fargo Bank) now allows a borrower to get a mortgage with a credit score of as low as 500 on a fixed rate FHA loan. The following criteria applies:
- Credit Scores 500 to 579 – borrower needs minimum 10% down payment.
- Credit Scores 580 to 599 – borrower needs minimum 5% down payment.
- Credit Scores 600 and up – borrower needs the normal minimum 3.5% down payment.
- Low Debt to Income Ratios – 31% for housing debt and 36% for total debt.
- Proof of 2 full months of housing payments (mortgage, taxes, and insurance) are required (cash in bank account after paying down payment and closing costs).
- Seller contributions may not exceed 3% of the purchase price for any borrower with a score less than 600.
- Gift funds are not allowed to count toward the down payment requirement for any borrower with a score less than 600.
Contact Christina today for more details!