Worcester FHA Loan Rates, Closing Costs & Stats

WORCESTER, MA-CT

FHA loans are mortgages created in the 1930's to help insulate lenders from credit risks and help promote home ownership. The Federal Housing Administration (hence, FHA) allows for lower downpayments and credit scores-- making these loans much more accessible than traditional mortgages.

FHA loans typically need just a 3.5% downpayment with credit scores of 580 or better. For credit scores between 500-579, the downpayment needs to be at least 10%.

While FHA loans make home ownership much more accessible to first-time homebuyers, they do require PMI (purchase money insurance)-- an additional insurance premium that is paid to the FHA to help cover defaults.

For additional requirements as defined by the FHA, click here.

Worcester's 139 lenders originated 1,877 FHA loans during 2023. The total origination value was $646,755,000, with an average FHA loan value of $344,568.

Worcester FHA Loans, 30 Year Fixed Rates

30 Year FHA mortgages in Worcester averaged 6.57% for the week of 2024-05-24, compared to the national average (all FHA variants) of 6.746% for the same period.

Worcester's average FHA mortgage closing costs are $9,157.

The average rate for the prior week (2024-05-17) was 6.76% and one month ago for the week of 2024-04-19, the average rate was 6.88%.

The average rate one year ago was 6.51%.

For refis of the same type during the week of 2024-05-24, the average rate was 6.61%.

Click on whitespace and scroll within the chart to zoom in/out. Larger bubbles equate with more originations.

Worcester FHA Loan Lenders by Rates & Fees

The below table looks at the average fees/closing costs and rates for FHA 30 Year Fixed Rate (purchase, first lien) mortgages originated by each lender at the Worcester level.

Name # of Loans 2023 Avg. 30yFix Rate 2023 Avg. Closing Costs
UNITED WHOLESALE MORTGAGE, LLC 201 6.49% $14,446
QUICKEN LOANS, LLC 163 6.25% $13,721
GUARANTEED RATE, INC. 100 6.85% $14,263
TOTAL MORTGAGE SERVICES, LLC 92 6.78% $15,057
CROSSCOUNTRY MORTGAGE, LLC 82 6.71% $15,604
GUILD MORTGAGE COMPANY 66 6.71% $14,305
FAIRWAY INDEPENDENT MORTGAGE CORPORATION 65 6.95% $12,957
MOVEMENT MORTGAGE, LLC 42 6.66% $15,451
LOANDEPOT.COM, LLC 41 6.41% $15,412
Paramount Residential Mortgage Group, Inc. 39 6.80% $12,955
BROKER SOLUTIONS, INC. 35 6.72% $14,864
CMG MORTGAGE, INC. 35 6.87% $13,222
NEWREZ LLC 32 6.38% $15,250
ENVOY MORTGAGE, LTD 32 6.68% $15,254
NORWICH COMMERCIAL GROUP, INC. 29 6.76% $12,457
Leader Bank 25 6.41% $11,597
FREEDOM MORTGAGE CORPORATION 25 6.86% $17,038
PENNYMAC LOAN SERVICES, LLC 24 5.91% $15,903
DREW MORTGAGE ASSOCIATES, INC. 23 6.61% $13,924
Mr. Cooper ( Nationstar Mortgage ) 23 6.11% $19,894
RADIUS FINANCIAL GROUP INC. 23 6.79% $16,757
Plains Commerce Bank 19 6.78% $12,362
AMERISAVE MORTGAGE CORPORATION 18 5.97% $16,530
MORTGAGE EQUITY PARTNERS LLC 18 6.75% $16,986
PRIMARY RESIDENTIAL MORTGAGE, INC. 17 7.07% $19,078
HOMEBRIDGE FINANCIAL SERVICES, INC. 15 6.48% $12,290
Nations Lending Corporation 14 7.25% $12,436
T2 FINANCIAL LLC 14 7.34% $14,604
Shamrock Home Loans, Inc. 14 6.92% $13,246
Citizens Bank 14 6.63% $13,414
LEADERONE FINANCIAL CORPORATION 13 6.92% $10,783
NORTHPOINT MORTGAGE, INC. 13 6.53% $13,557
SALEM FIVE MORTGAGE COMPANY, LLC 13 6.76% $11,603
GUARANTEED RATE AFFINITY, LLC 12 6.91% $13,777
EMM LOANS LLC 12 6.65% $17,058
Sierra Pacific Mortgage Company, Inc. 12 6.84% $15,490
OCMBC, INC. 12 6.77% $15,247
MUTUAL OF OMAHA MORTGAGE, INC. 12 6.63% $18,639
LAKEVIEW LOAN SERVICING, LLC 12 6.15% $14,593
HARBORONE MORTGAGE, LLC 11 6.72% $14,679
Ross Mortgage Company, Inc. 10 7.45% $13,770
PLAZA HOME MORTGAGE, INC. 9 6.78% $14,924
Equity Prime Mortgage LLC 9 7.10% $12,229
HOMESTEAD FUNDING CORP. 9 6.46% $10,171
Keystone Funding, Inc. 9 6.48% $15,216
Semper Home Loans, Inc. 9 6.81% $16,661
FIRST MORTGAGE COMPANY, INC. 8 6.56% $12,387
BAYCOAST MORTGAGE COMPANY, LLC 8 6.25% $10,162
RELIANCE FIRST CAPITAL, LLC 8 6.39% $18,256
EMBRACE HOME LOANS, INC. 7 6.73% $14,912
AMERICAN FINANCIAL NETWORK, INC. 7 7.13% $16,550
AMERICAN NEIGHBORHOOD MORTGAGE ACCEPTANCE COMPANY LLC 7 7.02% $17,063
NFM, INC. 7 6.86% $13,908
CARDINAL FINANCIAL 7 6.41% $13,120
Bank of England 7 6.11% $17,978
PRIMELENDING, A PLAINSCAPITAL COMPANY 6 6.71% $12,833
Mortgage Research Center, LLC 6 7.23% $8,487
NEW FED MORTGAGE, CORP. 5 6.63% $13,864
Flagstar Bank, FSB 5 6.80% $10,592
Carrington Mortgage Services, LLC 5 6.63% $12,476
Northpointe Bank 5 6.25% $14,734
BAY EQUITY LLC 5 7.00% $11,520
Evolve Bank & Trust 5 6.63% $13,652
ARK-LA-TEX FINANCIAL SERVICES, LLC. 4 6.50% $15,244
CIBM Bank 4 6.63% $10,868
MILEND, INC. 4 6.50% $13,255
First Federal Bank 4 6.28% $12,478
TOP FLITE FINANCIAL, INC. 4 6.88% $22,197
TD Bank 4 6.16% $7,776
NBKC BANK 4 5.69% $14,340
PROVINCE MORTGAGE ASSOCIATES, INC. 4 6.81% $11,975
Berkshire Bank 4 6.00% $9,333
FIRST WORLD MORTGAGE CORPORATION 3 6.71% $11,199
Fall River Five Cents Savings Bank 3 6.71% $12,331
EVERETT FINANCIAL, INC. 3 6.75% $9,012
HOMESIDE FINANCIAL, LLC 3 6.50% $9,450
DRAPER AND KRAMER MORTGAGE CORP. 3 6.58% $12,727
PHH Mortgage Corporation 3 5.96% $14,130
Prosperity Home Mortgage, LLC 3 6.96% $13,283
Residential Mortgage Solutions, Inc. 3 6.75% $13,168
Rockland Trust Company 3 6.50% $13,995
ZILLOW HOME LOANS, LLC 3 6.54% $12,128
American Mortgage & Equity Consultants, Inc. 3 7.50% $13,493
ALLIED MORTGAGE GROUP, INC. 3 6.21% $14,452
FIRST HOME MORTGAGE CORPORATION 3 6.33% $18,984
AMERICAN FINANCIAL RESOURCES, INC. 2 6.88% $15,755
U.S. Bank 2 6.87% $9,296
Ixonia Bank 2 6.75% $21,925
Easthampton Savings Bank 2 6.69% $10,071
Arvest Bank 2 6.50% $6,982
ACADEMY MORTGAGE CORPORATION 2 6.31% $17,514
Republic State Mortgage Co. 2 6.63% $16,376
EQUITY RESOURCES, INC. 2 7.24% $11,953
CALCON MUTUAL MORTGAGE LLC 2 6.50% $22,179
NORTHERN MORTGAGE SERVICES, LLC 2 6.75% $14,648
NP, Inc. 2 6.88% $10,216
First Internet Bank of Indiana 2 4.94% $14,879
Waterstone Mortgage Corporation 2 6.38% $10,969
Eastern Bank 2 6.50% $12,573
NATIONS DIRECT MORTGAGE, LLC 2 7.25% $23,790
LOANPAL, LLC 2 6.31% $13,890
NATIONS RELIABLE LENDING, LLC 2 5.94% $19,264
JPMorgan Chase Bank 1 6.13% $9,614
Bangor Savings Bank 1 5.63% $12,415
INTELLILOAN, INC. 1 6.50% $11,351
VILLAGE CAPITAL MORTGAGE 1 7.25% $3,419
Watermark Capital, Inc. 1 6.75% $9,665
HUNT MORTGAGE CORPORATION 1 6.75% $14,911
Webster Bank 1 5.88% $8,790
GENEVA FINANCIAL, LLC 1 7.25% $11,417
SUN WEST MORTGAGE COMPANY, INC. 1 5.96% $5,666
HOMESPIRE MORTGAGE CORPORATION 1 5.75% $25,471
Home Loan Investment Bank, F.S.B. 1 6.75% $12,504
The Camden National Bank 1 6.25% $12,197
The Federal Savings Bank 1 5.00% $20,481
The Washington Trust Company, of Westerly 1 7.25% $9,617
AMCAP MORTGAGE, LTD. 1 7.63% $18,691
Cornerstone First Mortgage, Inc 1 5.75% $9,166
NATIONWIDE MORTGAGE BANKERS, INC. 1 7.25% $15,603
CHURCHILL MORTGAGE CORPORATION 1 7.13% $13,674
M&T Bank 1 7.00% $10,967
Century Mortgage Company DBA Century Lending Company 1 7.13% $9,702
MID AMERICA MORTGAGE, INC. 1 7.25% $16,377
CRESCENT MORTGAGE COMPANY 1 6.75% $12,801
LIBERTY HOME MORTGAGE CORPORATION 1 6.63% $20,376
Liberty Bank 1 5.88% $6,783
LEGEND LENDING CORPORATION 1 7.25% $18,196
NJ LENDERS CORP. 1 6.49% $12,788
LAND HOME FINANCIAL SERVICES, INC. 1 7.00% $24,356
OCEANSIDE MORTGAGE COMPANY 1 5.50% $10,252
Old National Bank 1 6.00% $10,386
LADERA LENDING, INC. 1 6.63% $20,146
Barrington Bank & Trust Company, N.A. 1 5.63% $6,548
Wells Fargo Bank 1 6.63% $9,208
PLANET HOME LENDING, LLC 1 7.00% $8,332
PNC Bank 1 7.13% $11,651
POLARIS HOME FUNDING CORP. 1 7.25% $11,430
PREMIA MORTGAGE, LLC 1 5.63% $12,687
Bank of America 1 7.00% $4,988

The top Worcester FHA lender as defined by loan originations is UNITED WHOLESALE MORTGAGE, LLC, with 201 FHA loans originated. Their average total fees are $14,446, which is $725 higher than the next largest lender, QUICKEN LOANS, LLC.

The lowest fee Worcester FHA lenders (with over 10 loans originated) are LEADERONE FINANCIAL CORPORATION ($10,783), Leader Bank ($11,597), SALEM FIVE MORTGAGE COMPANY, LLC ($11,603), HOMEBRIDGE FINANCIAL SERVICES, INC. ($12,290) and Plains Commerce Bank ($12,362).

The lowest rate Worcester FHA lenders (with over 10 loans originated) are PENNYMAC LOAN SERVICES, LLC (5.91%), AMERISAVE MORTGAGE CORPORATION (5.97%), Mr. Cooper ( Nationstar Mortgage ) (6.11%), LAKEVIEW LOAN SERVICING, LLC (6.15%) and QUICKEN LOANS, LLC (6.25%).

Worcester FHA Loan Limits

Metro County Year Single Family Limit 2 Family Limit 3 Family Limit 4 Family Limit
WORCESTER, MA-CT WINDHAM 2022 $420,680 $538,650 $651,050 $809,150
WORCESTER, MA-CT WORCESTER 2022 $420,680 $538,650 $651,050 $809,150
WORCESTER, MA-CT WINDHAM 2023 $472,030 $604,400 $730,525 $907,900
WORCESTER, MA-CT WORCESTER 2023 $472,030 $604,400 $730,525 $907,900

Market Conditions (Median, Average Prices & Listing Count)

Realtor.com - Worcester (CBSA) retrieved from FRED, Federal Reserve Bank of St. Louis
Date Median Listing Price (YoY Change) Average Listing Price (YoY) MSA/US Median Price Ratio Active Listings
2018-01-01 $284,975 (6.5%) $345,132 (4.8%) 1.06 1,935
2018-02-01 $289,900 (5.5%) $352,279 (6.3%) 1.05 1,825
2018-03-01 $299,900 (7.2%) $367,340 (8.9%) 1.05 1,851
2018-04-01 $318,375 (8.1%) $383,405 (9.8%) 1.08 2,007
2018-05-01 $322,438 (7.8%) $387,342 (9.5%) 1.08 2,257
2018-06-01 $324,900 (6.5%) $387,347 (7.4%) 1.08 2,596
2018-07-01 $324,900 (8.3%) $388,514 (9.3%) 1.09 2,717
2018-08-01 $319,900 (9.4%) $383,473 (8.9%) 1.07 2,825
2018-09-01 $319,606 (10.3%) $382,196 (9.4%) 1.07 3,034
2018-10-01 $312,000 (7.8%) $378,225 (8.3%) 1.06 3,048
2018-11-01 $309,900 (7.2%) $371,841 (6.1%) 1.05 2,873
2018-12-01 $304,000 (5.2%) $368,778 (6.3%) 1.05 2,402
2019-01-01 $304,988 (7.0%) $370,805 (7.4%) 1.05 2,045
2019-02-01 $321,200 (10.8%) $377,180 (7.1%) 1.09 1,899
2019-03-01 $335,614 (11.9%) $390,601 (6.3%) 1.10 1,939
2019-04-01 $351,550 (10.4%) $405,694 (5.8%) 1.12 2,040
2019-05-01 $359,900 (11.6%) $413,484 (6.8%) 1.12 2,299
2019-06-01 $359,900 (10.8%) $422,344 (9.0%) 1.12 2,532
2019-07-01 $354,900 (9.2%) $417,377 (7.4%) 1.11 2,552
2019-08-01 $350,809 (9.7%) $413,552 (7.8%) 1.11 2,563
2019-09-01 $344,673 (7.8%) $406,959 (6.5%) 1.10 2,598
2019-10-01 $343,357 (10.1%) $402,327 (6.4%) 1.11 2,603
2019-11-01 $344,900 (11.3%) $399,114 (7.3%) 1.13 2,360
2019-12-01 $344,700 (13.4%) $396,896 (7.6%) 1.15 1,908
2020-01-01 $344,675 (13.0%) $400,188 (7.9%) 1.15 1,627
2020-02-01 $349,900 (8.9%) $414,469 (9.9%) 1.15 1,459
2020-03-01 $364,950 (8.7%) $432,462 (10.7%) 1.14 1,532
2020-04-01 $370,950 (5.5%) $429,618 (5.9%) 1.16 1,548
2020-05-01 $379,900 (5.6%) $438,213 (6.0%) 1.15 1,595
2020-06-01 $395,400 (9.9%) $461,864 (9.4%) 1.16 1,444
2020-07-01 $397,425 (12.0%) $463,616 (11.1%) 1.15 1,300
2020-08-01 $389,900 (11.1%) $467,523 (13.1%) 1.12 1,184
2020-09-01 $389,675 (13.1%) $472,711 (16.2%) 1.12 1,187
2020-10-01 $385,000 (12.1%) $477,667 (18.7%) 1.10 1,206
2020-11-01 $381,150 (10.5%) $472,067 (18.3%) 1.11 1,077
2020-12-01 $389,600 (13.0%) $472,512 (19.1%) 1.16 920
2021-01-01 $399,900 (16.0%) $489,820 (22.4%) 1.19 698
2021-02-01 $399,900 (14.3%) $488,560 (17.9%) 1.16 583
2021-03-01 $394,950 (8.2%) $483,649 (11.8%) 1.12 639
2021-04-01 $396,000 (6.8%) $476,153 (10.8%) 1.07 706
2021-05-01 $399,000 (5.0%) $482,777 (10.2%) 1.06 766
2021-06-01 $420,000 (6.2%) $490,866 (6.3%) 1.11 894
2021-07-01 $415,000 (4.4%) $485,508 (4.7%) 1.10 1,026
2021-08-01 $405,000 (3.9%) $479,811 (2.6%) 1.08 1,086
2021-09-01 $404,900 (3.9%) $481,572 (1.9%) 1.08 1,094
2021-10-01 $395,000 (2.6%) $469,813 (-1.6%) 1.05 1,099
2021-11-01 $394,084 (3.4%) $497,717 (5.4%) 1.05 924
2021-12-01 $387,475 (-0.6%) $505,277 (6.9%) 1.05 719
2022-01-01 $399,000 (-0.2%) $528,389 (7.9%) 1.08 544
2022-02-01 $423,250 (5.8%) $622,995 (27.5%) 1.10 489
2022-03-01 $438,675 (11.1%) $627,123 (29.7%) 1.10 508
2022-04-01 $449,000 (13.4%) $619,822 (30.2%) 1.07 615
2022-05-01 $469,450 (17.7%) $612,460 (26.9%) 1.07 789
2022-06-01 $449,950 (7.1%) $591,110 (20.4%) 1.00 963
2022-07-01 $449,900 (8.4%) $573,407 (18.1%) 1.01 1,164
2022-08-01 $449,900 (11.1%) $577,450 (20.4%) 1.04 1,129
2022-09-01 $439,925 (8.7%) $524,257 (8.9%) 1.03 1,066
2022-10-01 $449,900 (13.9%) $561,800 (19.6%) 1.06 1,093
2022-11-01 $449,450 (14.1%) $573,388 (15.2%) 1.08 1,055
2022-12-01 $445,000 (14.9%) $590,266 (16.8%) 1.10 819
2023-01-01 $464,905 (16.5%) $605,979 (14.7%) 1.15 728
2023-02-01 $494,450 (16.8%) $638,376 (2.5%) 1.19 609
2023-03-01 $493,000 (12.4%) $635,158 (1.3%) 1.16 582
2023-04-01 $504,900 (12.5%) $634,396 (2.4%) 1.17 674
2023-05-01 $516,175 (10.0%) $638,486 (4.3%) 1.17 714
2023-06-01 $509,950 (13.3%) $606,152 (2.5%) 1.15 774
2023-07-01 $519,400 (15.5%) $603,164 (5.2%) 1.18 730
2023-08-01 $499,450 (11.0%) $615,996 (6.7%) 1.15 811
2023-09-01 $490,000 (11.4%) $615,970 (17.5%) 1.14 893
2023-10-01 $487,400 (8.3%) $580,248 (3.3%) 1.15 927
2023-11-01 $475,000 (5.7%) $589,158 (2.8%) 1.13 942
2023-12-01 $479,450 (7.7%) $600,335 (1.7%) 1.17 766
2024-01-01 $498,000 (7.1%) $610,971 (0.8%) 1.22 621
2024-02-01 $499,350 (1.0%) $633,419 (-0.8%) 1.20 598
2024-03-01 $499,999 (1.4%) $643,339 (1.3%) 1.18 640
2024-04-01 $524,800 (3.9%) $660,384 (4.1%) 1.22 732
Worcester's median listing price for 2024-04-01 was $524,800, a difference of $19,900 (3.9%) versus the prior year and $24,801 versus the prior month.

Worcester's median listing price comes in at 122% of the national average.

Worcester's average listing price for 2024-04-01 was $660,384, a difference of $25,988 (4.1%) versus the prior year and $17,045 versus the prior month.

For the 2024-04-01 period, Worcester had 732 MLS listings, a difference of 92 listings (14%) versus the prior month and 58 listings (9%) versus the prior year.

Median Listing Time on Market & Square Footage

Realtor.com - Worcester (CBSA) retrieved from FRED, Federal Reserve Bank of St. Louis
Date Median Listing Time on Market Median Square Footage
2018-01-01 80 days 1,792 sqft
2018-02-01 75 days 1,800 sqft
2018-03-01 47 days 1,804 sqft
2018-04-01 39 days 1,840 sqft
2018-05-01 33 days 1,836 sqft
2018-06-01 37 days 1,858 sqft
2018-07-01 44 days 1,876 sqft
2018-08-01 51 days 1,880 sqft
2018-09-01 51 days 1,876 sqft
2018-10-01 54 days 1,869 sqft
2018-11-01 60 days 1,851 sqft
2018-12-01 70 days 1,820 sqft
2019-01-01 79 days 1,802 sqft
2019-02-01 78 days 1,828 sqft
2019-03-01 60 days 1,879 sqft
2019-04-01 39 days 1,971 sqft
2019-05-01 38 days 2,019 sqft
2019-06-01 39 days 2,030 sqft
2019-07-01 48 days 2,000 sqft
2019-08-01 52 days 1,981 sqft
2019-09-01 53 days 1,952 sqft
2019-10-01 53 days 1,943 sqft
2019-11-01 58 days 1,920 sqft
2019-12-01 75 days 1,892 sqft
2020-01-01 79 days 1,877 sqft
2020-02-01 58 days 1,904 sqft
2020-03-01 35 days 1,988 sqft
2020-04-01 44 days 2,000 sqft
2020-05-01 52 days 2,000 sqft
2020-06-01 41 days 2,000 sqft
2020-07-01 37 days 2,000 sqft
2020-08-01 36 days 2,002 sqft
2020-09-01 26 days 1,960 sqft
2020-10-01 26 days 1,952 sqft
2020-11-01 42 days 1,920 sqft
2020-12-01 54 days 1,873 sqft
2021-01-01 54 days 1,900 sqft
2021-02-01 47 days 1,810 sqft
2021-03-01 16 days 1,801 sqft
2021-04-01 15 days 1,793 sqft
2021-05-01 14 days 1,815 sqft
2021-06-01 16 days 1,843 sqft
2021-07-01 22 days 1,830 sqft
2021-08-01 24 days 1,808 sqft
2021-09-01 27 days 1,808 sqft
2021-10-01 26 days 1,778 sqft
2021-11-01 35 days 1,768 sqft
2021-12-01 39 days 1,718 sqft
2022-01-01 47 days 1,706 sqft
2022-02-01 28 days 1,768 sqft
2022-03-01 16 days 1,798 sqft
2022-04-01 10 days 1,846 sqft
2022-05-01 14 days 1,895 sqft
2022-06-01 16 days 1,874 sqft
2022-07-01 23 days 1,875 sqft
2022-08-01 30 days 1,885 sqft
2022-09-01 32 days 1,869 sqft
2022-10-01 33 days 1,879 sqft
2022-11-01 37 days 1,878 sqft
2022-12-01 52 days 1,850 sqft
2023-01-01 52 days 1,872 sqft
2023-02-01 42 days 1,889 sqft
2023-03-01 31 days 1,875 sqft
2023-04-01 19 days 1,921 sqft
2023-05-01 19 days 1,973 sqft
2023-06-01 18 days 1,956 sqft
2023-07-01 25 days 1,939 sqft
2023-08-01 23 days 1,877 sqft
2023-09-01 27 days 1,879 sqft
2023-10-01 27 days 1,871 sqft
2023-11-01 32 days 1,855 sqft
2023-12-01 44 days 1,824 sqft
2024-01-01 45 days 1,830 sqft
2024-02-01 30 days 1,813 sqft
2024-03-01 23 days 1,812 sqft
2024-04-01 22 days 1,877 sqft
Worcester's median listing age (time on market) for 2024-04-01 was 22 days. This is 19% longer than the same period one year ago.

Worcester's median square footage for active listings during the 2024-04-01 period was 1,877 sqft. One year prior, the average listing was 1,921 sqft.

FHA Loan Requirements

  • Borrowers must have a steady employment history or worked for the same employer for the past two years.
  • Borrowers must have a valid Social Security number, lawful residency in the U.S. and be of legal age to sign a mortgage in your state.
  • Borrowers must pay a minimum down payment of 3.5 percent. The money may be gifted by a family member. (Traditional mortgages do not permit gifted down payments)
  • New FHA loans are only available for primary residence occupancy.
  • Borrowers must have a property appraisal from a FHA-approved appraiser.
  • Borrowers’ front-end ratio (mortgage payment plus HOA fees, property taxes, mortgage insurance, homeowners insurance) needs to be less than 31 percent of their gross income, typically. You may be able to get approved with as high a percentage as 40 percent. Your lender will be required to provide justification as to why they believe the mortgage presents an acceptable risk. The lender must include any compensating factors used for loan approval.
  • Borrowers’ debt to income ratio (mortgage plus all your monthly debt, i.e., credit card payment, car payment, student loans, etc.) needs to be less than 43 percent of their gross income, typically. You may be able to get approved with as high a percentage as 50 percent.
  • Borrowers must have a minimum credit score of 580 for maximum financing with a minimum down payment of 3.5 percent.
  • Borrowers must have a minimum credit score of 500-579 for maximum LTV of 90 percent with a minimum down payment of 10 percent.
  • Bborrowers must be two years out of bankruptcy and have re-established good credit. Exceptions can be made.
  • Typically borrowers must be three years out of foreclosure and have re-established good credit.
  • The purchased property must meet certain minimum standards at appraisal. If the home you are purchasing does not meet these standards and a seller will not agree to the required repairs, your only option is to pay for the required repairs at closing (to be held in escrow until the repairs are complete).