FHA Purchase with 500 Credit Score in Houston Metro
Banks say 620 minimum. We say 500. Manual underwriting means we look at your whole story, not just a number.
Joe Pisa
Founder & Senior Loan Officer
NMLS #139369
"If Rocket, Chase, or your local credit union just crushed your dreams because of your credit score, self-employed income, or because you want to count your Airbnb income — you're in the right place."
Hey, if you're in Houston and you've been told your credit score is too low for a mortgage — don't give up. Most lenders have overlays that require 620 or even 640 for FHA. That's their rule, not FHA's rule. FHA actually allows scores down to 500 with 10% down, and 580 with 3.5% down. We follow FHA guidelines, not bank overlays. We manually underwrite every low-score file, which means a human looks at your situation instead of a computer saying 'denied.' Last month we closed a $687k FHA purchase in Frisco with a 514 middle score. We do the same thing in Houston every week.
Why We Close What Banks Deny
- FHA loans down to 500 credit score with 10% down
- 580+ credit score = 3.5% down payment
- Manual underwriting — we look at your whole story
- No overlays on bankruptcy, foreclosure, or collections
- Gift funds allowed for entire down payment
- Close in 21-30 days
Recent Closings in Houston Metro, TX
These are real deals we closed. Banks denied them. We didn't.
FHA purchase — 10% down, manual underwrite, first-time buyer
FHA purchase — 2 years post-bankruptcy, gift funds for down payment
FHA purchase — self-employed, bank statements + FHA combo
FHA Loans Questions for Houston Metro, TX
Real questions we get daily — with straight answers
Can I really get an FHA loan in Houston with a 500 credit score?
Yes. FHA allows 500-579 with 10% down. Most lenders won't do it because of their overlays. We don't have overlays.
What is manual underwriting?
Instead of a computer auto-approving or denying you, a human underwriter reviews your file. They look at compensating factors like stable employment, low debt, and savings.
How long after bankruptcy can I get FHA in Texas?
Chapter 7: 2 years from discharge. Chapter 13: 1 year with court approval and on-time payments. We've closed both in Houston.
What's the maximum FHA loan amount in Harris County?
For 2025, the FHA limit in Harris County (Houston) is $472,030 for a single-family home. Higher limits apply for 2-4 units.
Can I use gift funds for my down payment?
Yes. FHA allows 100% of your down payment to come from gift funds from family members. We just need a gift letter.
Do medical collections affect my FHA approval?
No. FHA ignores medical collections completely. Non-medical collections under $2,000 don't need to be paid off either.
NorthStar Funding is a licensed mortgage broker. NMLS #139369. Equal Housing Lender. All loans subject to credit approval. Rates and terms subject to change without notice.