The hardest and easiest home loans to get


Although credit minimums have become more lax, people are still struggling to secure home financing. That is why it is important to do research on the type of loans that are easier to receive and which are harder to receive. The information below will help you gain knowledge on specific loans.

FHA loans
This loan was created to primarily help lower-income buyers access homeownership. While they do come with both an upfront mortgage insurance premium and a monthly version of which you pay for the life of the loan, they only require a 3.5% down payment. Lenders of the FHA loan are more forgiving towards people with a suffering credit score. The average FICO score of successful FHA homebuyers in August was 691. People who didn’t qualify for the loan had an average score of 667. This program also recently changed their policy so that qualified homeowners to purchase a home after just one year being removed from foreclosure.

Conventional Loans
These kinds of loans do not come with a government backing and conform to requirements set by Fannie Mae and Freddie Mac. Conventional loans tend to be tougher to receive with a lower credit score than those type of loans that are government backed. The credit score they look for is at least 740, which is much higher than the typical minimum score for loans that are government backed, like the FHA loans. The average score they accept is 758 and you will need at least a 5% down payment to secure the loan.

VA Loans
This loan, like that of the FHA loan, is also government backed. The VA loan is booming and continues to grow since 2007 due to the difficulty for veterans and service members to qualify for conventional financing. They do not require a down payment or private mortgage insurance and accept people who have a minimum credit score of 620. That score falls under the category of “Fair”, sitting a step below “Good”. Borrowers of this loan without a service-connected disability will pay a funding fee on purchase and refinance loans which runs at about 2.15% of the loan amount which is a price that veterans are able to finance. VA loans have had the lowest foreclosure rate in the past five years. Although they may be the easiest loans to get, they are also the hardest loans to receive due to the statistical evidence that only less than 1% of the population currently serves in the U.S. Military, which is a requirement of the loan.


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