Are you currently in an FHA loan and thinking about refinancing but worried because you have bad credit? Or maybe you don’t have “bad” credit, maybe you just have so-so credit. Just a few of the questions that you may be asking include: “can I get a lower mortgage payment?”, “can I qualify even if I have bad credit?”, “do I need a special lender or can I just use any kind of lender?” and these are maybe just a few.
The mortgage market has changed quite a bit in the last few years – from being easy to get credit in the mid 2000’s, to almost impossible to get credit starting in about 2008 and most recently lenders starting to loosen guidelines and begin lending again.
Credit Score Requirements
For the FHA streamline refinance program, if you have a credit score that you are worried about – you need to shop multiple lenders. The reason for that is that many lenders are changing / lowering their credit score guidelines in today’s market and you will likely find that lenders will have different credit score requirements. There is one constant that is generally true with most all FHA lenders – because the government is insuring the loan, they have some less-than-perfect credit options available as well as some good credit options.
Generally speaking, there are two credit score numbers that are generally good gauges to go by: 580 and 620. 580 and 620 are common minimum credit score requirements for many lenders in today’s market. Those two are not the set-in-stone numbers, but they are common. It is possible that some lenders will have lower score requirements and some will have higher score requirements – so again, it is important to shop multiple lenders.