• FHA loans are often easier to qualify for than traditional mortgages.house with picket fence image by Michael Shake from Fotolia.com
  
  Federal Housing Administration (FHA) loans are attractive to many first-time home buyers because the financing qualifications are less stringent than conventional loans. FHA also offers low down payment mortgages for those who meet minimum credit score guidelines. Although FHA does not impose maximum income limits for applicants, it does have maximum mortgage loan limits. Here are some other FHA financing qualifications.
  
  

Credit Issues

• You can have a few credit problems and still qualify for an FHA loan. FHA requires you pay off all collection accounts with outstanding balances before you close on your loan. If you have a bankruptcy, you have to wait until two years after the discharge date before you can qualify for an FHA loan. If you have had a previous foreclosure, you must wait at least three years after the foreclosure date before FHA will approve you for a loan.
  
  

Credit Score

• A low credit score does not automatically disqualify you for an FHA loan. FHA does not impose minimum credit scores for financing and takes each credit situation on a case-by-case basis. However, your credit score will affect the amount FHA will require you to put down on your new house. Those with a credit score of 580 or above qualify to put only 3.5 percent down on their home. FHA requires those with a credit score lower than 580 to have at least a 10 percent down payment.
  
  

Income

• FHA doesn't have income limits for its mortgage loans. You must simply demonstrate that you are able to make your monthly mortgage payments while still being able to meet other monthly debt obligations. Your income does affect your total loan amount. FHA will only give you a mortgage loan where payments are no more than 29 percent of your gross monthly income. Your total debt, not including insurance and utility bill payments, cannot be more than 41 percent of your monthly gross income in order to qualify for an FHA loan.