Can I get an FHA loan without established credit?

No. To obtain an FHA loan, you must have established credit. However, that does not necessarily mean that you have to have a long term seasoned credit profile at the three credit reporting agencies. We have investors that will look at alternative credit. For example, if you are renting, pay utilities, have a cell phone, etc., then you have a payment history. These are referred to as "Alternative Credit" accounts. The investors that will consider this usually have a higher rate schedule, but they are willing to take the additional risk this type of borrower. Work with a local Mortgage Banker/Broker, rather than one of the big banks or big national mortgage factories. Unlike a bank employee, who is most likely just an order taker, a Mortgage Broker/Banker is Trained, Tested and Licensed in all aspects of Mortgage Origination. We have access to loan products of many lenders, not just those of one bank, and can properly guide you. But more importantly, we are trained to take a look at the various different options available to you and guide you into the one that makes the best sense for your situation. Plus, the big banks are not willing to consider alternative credit.Don't forget to check out your selected Mortgage Originator at the National Mortgage Licensing System at www.NMLSConsumerAccess.org ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950

Bert is spot on.. The best advice I can give you is to contact a LOCAL mortgage broker and apply with them. Not the local "Big" bank, and certainly not one of those 50 states internet lenders...By applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with numerous lenders, seeking out the best loan terms for your particular scenario. Because he has lower overhead, he can offer you lower rates and lower fees than most of the larger lenders.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Bert, you did indeed articulate very sound recommendations. I'd like offer some additional information that might help those individuals without a credit score. Big banks may certainly not be inclined to use Alternative Credit based on the automated processes in place, but they are in fact required by Federal Law to 'consider' Alternative Credit when presented. This is stated in the Equal Credit Opportunity Act, Regulation B Section 202.6(b)(6) - Rules Concerning Evaluation of Applications. On the applicant's request a creditor must consider credit information not reported through a credit bureau when the information relates to the same types of credit references and history that the creditor would consider if reported through a credit bureau - http://www.fdic.gov/regulations/laws/rules/6500-2900.html#fdic6500202.6. If any creditor who fails to comply with any requirement imposed under this title shall be liable to the aggrieved applicant for punitive damages in the amount not greater than $10,000 per action, in addition to any actual damages - http://www.fdic.gov/regulations/laws/rules/6500-3000.html#fdic6500supplementitopart202. This also goes for Fannie Mae and Freddie Mac, they too have guidelines in place for the use of Alternative Credit. Fannie Mae and Freddie Mac allow lenders to use Non Traditional Mortgage Credit Reports (NTMCRs) only when a traditional credit score is unavailable for the borrower from any of the three national credit bureaus. It seems clear the use of NTMCRs can help reduce obstacles for the 88 million people who don't have a credit score and might otherwise be unnecessarily subjected to subprime mortgage rates or even be rejected entirely.Taking the nontraditional route can be the best way for lenders to help borrowers move into the mainstream of homeownership financing. The individual who posted the question needs to understand their legal rights regardless of whether applying for a mortgage loan at a local lender or at 'big banks/national mortgage factories'. As a matter of full disclosure my name is Steven Shaw. I work at company called eCredable, a consumer oriented Credit Reporting Agency helping people access affordable mainstream financial services. We also work with a leading national mortgage lender, Churchill Mortgage, who actively accepts our AMP Credit Report(R) and AMP Credit Rating(R) which is entirely based on verified Alternative Credit information. Our credit report meets industry best practice standards for accuracy and authenticity as well the guidelines of Fannie Mae, Freddie Mac, HUD and FHA.