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FHA Co-borrower questions

I have a foreclosure on my report that is less than 3 years old, so I don't qualify for a fha loan.  Can I use a co-borrower to qualify?  If so what are the requirements for the co-borrower?  I have enough income and 660 credit score.  Do they combine the co-borrowers income with mine to qualify or does he have to qualify on his own?
  • December 23 2009 - Sapulpa
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Answers (8)

You would not qualify for a FHA loan.  Co-signors are used to help with debt ratios and those with limited credit.  Co-signors can not be used to offset credit issues.
  • December 23 2009
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Bob is correct, however, if it is your spouse, the lender will use their credit and income to qualify.  But, for instance, is another family member that will not be occupying the property, then that becomes a totally different scenario in which it becomes an investment with 20% down.
  • December 23 2009
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Chris,

Why would they do that?
  • December 23 2009
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You can still do a non-occupant co-borrower with 3.5% down on a FHA loan.  It doesn't need to be treated as an investment property.

Conventional guidelines now require 20% down with a non-occupant co-borrower.  I believe this is a PMI guideline and not a credit overlay by lenders.
  • December 23 2009
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Bob,

The borrower cannot get a loan through FHA...Why would it matter if the co-borrower was his spouse or not?
  • December 23 2009
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It wouldn't.  I was addressing the comment on requiring 20% as an investment property if the co-borrower didn't live in the property.  I already stated they could not get a FHA loan.
  • December 23 2009
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If the coborrower has enough income and credit to qualify, your loan should not be a problem. Your income cannot be considered since you are not on the loan. In community property states, the co borrower would have to have enough income to qualify to cover your debt load.
  • November 23 2010
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Mike...This thread is a year old...the borrower only needs to wait another 2 months and they can get an FHA loan without a co-borrower...
  • November 23 2010
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