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can a repossession 3 years ago keep you from getting a FHA loan?

My husband and I are trying to buy our first home..well three years ago we relinquished his rights to a truck little did we know that it would show as a repossession on his credit score. We paid off the remaining balance of the truck after they sold it at auction. Since then we have built his credit score back up to a 688 and mine is a 733. Will this stop us from getting a FHA home loan?

Public Comments

1. No....you should be able to get a FHA loan with that credit score and being that much time having elapsed. The lender might require you to write a letter of explaination. Check with a couple of large FHA lenders like Quicken Loans or Ditech over the phone. They are about the largest FHA lenders in the U.S.
2. Generally no, this won't prevent you from getting an FHA home loan. With credit scores like yours, lenders typically look at the previous 24 months payment/credit history. If, by chance, a lender does deny you, talk to another one. Lender's loan guidelines these days are too strict, mainly because of the present mess the real estate industry is in, but they are still in the money lending business. Just make sure you have several months of cash reserves saved up as lenders will require this. In other words, several months worth of your new principal, interest, taxes and insurance saved up.
3. No, you are fine with those credit scores and since you paid off the balance, you are not showing as an open negative balance. You should be in great shape. Good Luck!!!