| Being credit-free is great but it has its disadvantages. | | | | show the agency that you can manage your |
| Without a history of credit, it will be difficult to apply for | | | | payments. To begin your application, you have to |
| a loan from conventional lending companies. And | | | | submit the following requisite documents: proof of |
| without a history of credit, the lender has no credit | | | | residence including all your addresses in the past two |
| report to review and check whether you're eligible for | | | | years; employment history; and income tax returns or |
| credit or not. | | | | W2 for the past two years. Also, if you are a former |
| The good news is, you can still keep that clean credit | | | | veteran, you have to include your discharge papers in |
| history and be able to apply for a loan. The FHA | | | | the documents to be submitted to the FHA. These |
| allows you to apply for credit with non-conventional | | | | documents will indicate your financial position in the |
| credit institutions. In the FHA loan qualifications, it | | | | past two years. The FHA will assess and measure |
| indicates that applying for a loan is possible even if you | | | | your creditworthiness based on these credit |
| don't have trade lines with the three major credit | | | | references. |
| bureaus. | | | | In summary, the FHA can grant you a loan even if you |
| As a potential borrower, you are required by the FHA | | | | don't have a credit history to support your |
| to submit three credit references from the two groups | | | | creditworthiness. Having said that, you must pay your |
| of non-conventional credit resources. The first group is | | | | bills on time, prove that you have a stable employment |
| composed of utility payments including electricity, gas; | | | | and you are responsible enough to meet your financial |
| and rental payments. This group is given more weight | | | | obligations. So you see, you still have credit options |
| and is a good indicator of your creditworthiness. The | | | | even if you don't own a credit card or a car for that |
| second group, on the other hand, is consists of | | | | matter. Applying for credit with the FHA is easy but |
| payment to day care, bank statements showing | | | | you have to take note that you have to take care of |
| increased savings over time and insurance payments. | | | | your financial reputation otherwise, you may lose this |
| The FHA will also look into your employment. You | | | | privilege altogether. |
| have to have a stable job in the past two years and | | | | |