Perfect credit is not needed to get a mortgage. Home ownership today is higher than ever before because loans are being extended to more borrowers. Contact your mortgage broker to find the loan that is right for you.

Fha loans offer a great rate to those who have some credit blemishes. You will be required to write a letter of explanation to explain why you were past due and may be required to pay off any collections to qualify.

No. Imagine if perfect credit was required. Few loans would be made and every lender in town would be bankrupt.

Some lenders out there will even take an average of your three credit scores instead of using one particular credit score to determine how high of a ltv, loan to value, they will allow on a mortgage loan. For two borrowers they will even add up all three credit scores for each borrower together and then take an overall average to come up with one credit score that they will use to determine what mortgage parameters you will qualify for. Therefore, if one partner has poor credit but makes all or most of the money and the other has excellent credit but makes little to no money, by using a combined average for both borrowers it may help the borrowers to qualify for a better loan or a higher ltv. Ask your mortgage professional if you have any questions about how this works.

Another factor that is used with your fico score to determine how much you can borrow (your levis what type of documentation is being used. Full doc means you are submitting w-2′s and pay stubs, or tax returns if self employed, and you are documenting your assets with bank or brokerage statements. A full doc loan will allow for a higher ltv than a stated doc loan with the same fico score.

The common cut-off score for 100% financing is a 580 score. There are some programs that vary slightly from this number, and the programs are always changing, so this is not set in stone.

If your student loan payments are deferred but are still required to be calculated in your debt to income ration, be sure to obtain a copy of the original student loan documents. With the principle, interest rate, and term, your loan professional can determine a payment that may be much less than the lenders estimates.

Most lenders take your mid-score, or the middle score of the three scores reported by the bureaus. However, some lenders are willing to take the highest of the three scores, which sometimes can end up being the difference between a deal or no deal, or a deal and a good deal.

Lenders will also use the fully indexed mortgage payment including taxes and insurance to determine the dti. This means loans with small initial start rates, are not any easier to qualify for due to the small initial payment.

For those individuals with less than perfect credit, non-conforming lenders allow loans up to sometimes 95% of their property’s value. Certain criteria must be met and these individuals should expect to pay slightly higher charges in closing costs and having a slightly higher note rate. It is also not uncommon for these non-conforming loans to have a pre-payment penalty.