The FHA loan is a government loan put in place to help people buy homes. Most of the rules are common sense, but we thought we would list them anyway.
1.) You cannot use an FHA loan to buy an investment property or a second home. The idea that our government will spend tax dollars to help people buy vacation homes in Miami Beach seems like an odd one, but this question still comes up occasionally.
2.) You cannot take out an FHA loan if you have unpaid judgments on your credit report, haven’t paid your income taxes, or have defaulted on your student loans. If you have not filed a tax return in ten years, you will not be able to get a loan from the Federal Housing Administration.
3.) FHA loans require “full documentation”. This means that you have to prove your earnings with pay check stubs and tax returns. You will also need to provide bank statements. If you work under the table, are self-employed and you hide most of your income, then you will not qualify. You must pay taxes if you want to get help from a taxpayer-paid program.