HUD Handbook 4000.1 II.A.1.b — Borrower Eligibility (FHA Title II Forward Mortgages)
FHA borrower-eligibility requirements from Handbook 4000.1 Part II.A.1: minimum decision credit score, borrower/co-borrower ownership and obligation, co-signers, and U.S. principal-residence.
Verbatim regulatory text
Verbatim provisions from HUD Handbook 4000.1 II.A.1.b — Borrower Eligibility (FHA Title II Forward Mortgages) — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
HUD Handbook 4000.1 II.A.1 — Minimum Decision Credit Score
(3) Borrower Minimum Decision Credit Score (a) Definition The Minimum Decision Credit Score (MDCS) refers to the credit score reported on the Borrower’s credit report when all reported scores are the same. Where three scores are reported, the median score is the MDCS. Where two differing scores are reported, the MDCS is the lowest score. Where only one score is reported, that score is the MDCS. An MDCS is determined for each Borrower. Where the Mortgage involves multiple Borrowers, the Mortgagee must determine the MDCS for each Borrower, and then select the lowest MDCS for all Borrowers. Where the Mortgage involves multiple Borrowers and one or more of the Borrowers do not have a credit score (non-traditional or insufficient credit), the Mortgagee must select the lowest MDCS of the Borrower(s) with credit score(s). (b) Eligibility Standard The Borrower is not eligible for FHA-insured financing if the MDCS is less than 500.
HUD Handbook 4000.1 II.A.1 — Borrower & Co-Borrower Ownership and Obligation Requirements
(4) Borrower and Co-Borrower Ownership and Obligation Requirements To be eligible, all occupying and non-occupying Borrowers and co-Borrowers must take title to the Property in their own name or a living trust at settlement, be obligated on the Note or credit instrument, and sign all security instruments. In community property states, the Borrower’s spouse is not required to be a Borrower or a Co-signer. However, the Mortgage must be executed by all parties necessary to make the lien valid and enforceable under state law.
HUD Handbook 4000.1 II.A.1 — Co-signer Requirements
(5) Co-signer Requirements Co-signers are liable for the debt and therefore, must sign the Note. Co-signers do not hold an ownership interest in the subject Property and therefore, do not sign the security instrument.
HUD Handbook 4000.1 II.A.1 — Principal Residence in the United States
(6) Principal Residence in the United States Non-occupying co-Borrowers or Co-signers must either be United States (U.S.) citizens or have a Principal Residence in the U.S.