It may be possible to get an FHA mortgage with those scores, but you have to meet a rigid qualification process. These apply to credit scores from 500 to 579.

o Purchase transaction limited to 90% LTV/CLTV
o Buyers must complete homebuyer education and provide the signed certificate for each
borrower.
o Requires completed Verification Of Employment by employer
o Maximum ratios for a manual underwrite are 31/43 and the file must reflect two
compensating factors
o Verification of rent by providing 12 months cancelled checks or a VOR from a property
management company. If the borrower lived with a family member, borrower to provide a signed
budget letter.
o A letter of explanation for all inquiries and all derogatory credit regardless of the date. The
explanation must make sense and be consistent with other credit information in the file.
o Borrower's credit history cannot include a late payment within the past 12 months on any
account.
o Collections in excess of $1000.00 must be paid.
o Collections/Charge-Offs less than 24 months old and greater than $5000.00 will be reviewed
on a case-by-case basis and requirement for payoff is at underwriter's discretion
o Non-occupying co-borrowers are not allowed
o Gift funds are not allowed

Please note that these are only some of the qualifications and does not suggest that meeting these will automatically qualify you.

If this sounds like you and you are patient and willing to go through a process including first attempting to improve your credit, feel free to contact me and I'd be happy to review your options.

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