HUD is also known as the US Department Housing and Urban Development, a US government agency charged with helping to make home ownership more affordable, especially for low and middle income borrowers. Given this information, it comes as a surprise to know there really is no such thing as a HUD loan. The agency doesn’t actually make any loans. Instead, they provide loan guarantees and establish less stringent requirements than conventional mortgage options.
If you are looking for HUD home loans, we can help. Our professional Mortgage Advisors are waiting to answer all your questions regarding HUD loan options, terms, and requirements. Give us a call TODAY, at (800) 927-6560 for your FREE consultation or click here to apply online.
HUD Home Loans Offer Lower Down Payments:
HUD home loans, through their partnership with the FHA, could help you to get into a home with as little as a 3.5 percent down payment.
Lower Credit Scores Needed For A HUD Loan:
Another source of worry and stress when undergoing the home loan process has always been the credit examination. With HUD home loans, you do not need to have perfect credit. In fact, the minimum credit score for such loans (again, through the FHA) is just 580. In cases where borrowers might have some hits on their credit records, situations are reviewed for patterns of behavior instead of simply being disqualified for one or two dings.
Bear in mind that some HUD lenders may require credit scores a bit higher. Even still, you are almost always going to find a HUD loan will be more accommodating credit wise than other conventional types of mortgages. Believe it or not, even a foreclosure or bankruptcy will not automatically disqualify you…although specific time lines are outlined by HUD in such situations.
More Lenient Debt Ratios:
In almost every type of mortgage evaluation, HUD home loans being no exception, debt ratios will play a large role in determining how much of a loan you can qualify for. HUD home loans are generally a bit more lenient on the debt to income ratio than other types of mortgages.
A HUD loan also has a requirement for a back end debt ratio. This is determined by adding the potential monthly house payment to the total of your fixed monthly debt like credit cards, car loans, installment loans, etc… Then divide the total debt payment amount by your monthly gross income to come up with your back end debt ratio. In most situations, HUD home loans have a greater tolerance for higher back end debt to income ratio than other types of mortgages.
Thinking about buying a home? A HUD loan could be exactly what you need…even if you may have been turned down before. Loan down payments, more lenient debt ratios, etc… Contact us TODAY for your FREE consultation, at (800) 927-6560.
At California Mortgage Advisors Inc., we genuinely believe that we offer our customers the best mortgages in the industry. We have offered a variety of loans since 1993, which means our Mortgage Advisors have successfully matched tens of thousands of borrowers with loans tailored to meet their needs and unique financial situations. Our Mortgage Advisors are available at (800) 927-6560 to answer your questions or click here to apply online.