How Do You Qualify for an FHA Loan These Days?

Going through our recent debacle with refinancing our primary mortgage, and not being able to roll in our secondary mortgage with it and make it an FHA loan (this was the only way the bank could roll them into one unfortunately), I can tell you how frustrating it is. We are very responsible people who pay our bills on time, make a decent living and have never been late on our mortgage payment.

But because of some little rules they have about part of our income being from a business (we both also have full time corporate salaried jobs mind you, but do receive a portion of our income that allowed us to buy our house from side businesses), we were denied getting a full on FHA loan to cover both mortgages.

Combining our mortgages would have made it a hell of a lot easier for us to pay them both together, but it also would have afforded us a much better interest rate on the one mortgage loan because our secondary mortgage is a much higher interest rate.

This apparently is not unusual for a secondary mortgage since the bank views it as a sort of gift since you didn’t put down a down payment. Heck, I don’t even think you can still do this these days with all the new rules surrounding loans.

Now, FHA loans are going to become even harder to secure. The government recently announced that they may not be offering FHA loans at all to people with low credit scores. From a business perspective, I suppose one cannot blame them too much. However, from an economic recovery standpoint, this really may not bode well for a lot of citizens and lenders because now the market of potential home buyers will become even more narrow than it already is.