Realtors: Important 2021 Loan Program Updates to Share with Your Clients

Now that we’re deep in the Spring homebuying season – and slowly inching toward our post-COVID sense of ‘normalcy’ – there are quite a few home loan program updates to be aware of.

These updates affect government-backed loans, including FHA and VA loans, and non-qualified mortgages for self-employed borrowers.

Share these updates with your real estate clients and let me know if I can answer any questions for you and your clients!

Credit Scores & DTI Ratio Thresholds Relax Slightly for Government-Backed Loans

For government-backed home loan programs, I’m seeing credit score and debt-to-income (DTI) ratio guidelines – that were tightened up earlier during COVID – begin to relax slightly. In addition, these home loans can also now be used on a wider range of home types.

Buyers using FHA and VA loans can now:

  • Qualify with a reduced credit score of 580

  • Finance manufactured homes with these programs

  • Qualify with increased DTI ratios

  • VA loan borrowers can qualify with an up to 50% DTI ratio

  • FHA loan borrowers –  with compensating factors & manual underwriting – can qualify with a 40% to 50% DTI ratio

  • Certain FHA loan borrowers can qualify without a credit score

Relaxed Guidelines for Self-Employed Borrowers

Financing for self-employed borrowers (non-qualified mortgages) has always been challenging – even before the pandemic. But guidelines are relaxing for these borrowers as well.

  • Applicants without traditional regular income sources and credit challenges within the last 12 months can now apply for financing and qualify in some circumstances

These updates open up the opportunity for self-employed applicant clients who previously have been turned down for loans.

Today’s Generational Snapshot of the Homebuying Market

Along with these updates, we’re noting a shift in post-COVID homebuying preferences by generation, according to new research from Freddie Mac. 

This infographic offers a good rundown of the changing landscape. Overall, the outlook for 2021, amid post-pandemic and generational influences, still looks positive! 

I’d Love to Work with You & Your Clients!

As always, I love sharing regular loan program updates with my realtor friends!

If you’re working with a client who needs financing or is starting to think about getting pre-approved, I’d love to speak with them! Give me a call at 480-313-7103 or email me at

* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.