Haven't rented/paid utilities for years - FHA delays?

6 Replies

hey All,

I would be a first-time home buyer (Boston area) and am considering house hacking for my first rental property in nearby Manchester, New Hampshire. I haven't paid any utility bills or formal mortgage/rent in the past year as I am living with my parents. A BP article on FHA loans (https://www.biggerpockets.com/renewsblog/2015/03/2...)  stated the following:

"not being able to demonstrate a history of payments that the vast majority of Americans are making each and every month can actually delay you significantly.

When you ask a bank for a loan, especially if you are a first time buyer applying for FHA financing, the lender will want to see the following:

  • Your credit score
  • Your income
  • A track record of consistent and significant payments

Here are some examples of payments that you’ll want to have made (consistently) for at least a year if you are looking to get financing for your first property:

Item #1. Credit card payments

Item #2. Rent or mortgage payments

Item #3. At least one instance of a utility bill like electric/water/internet

It’s really easy to check and make sure that you are paying these consistently, but it’s also easy for a lot of folks to informally pay roommates/parents/loved ones for these types of services. Make sure that your name is on any credit card, lease/mortgage, and utilities that you pay. It’s important to demonstrate that track record to your lender."

So finally, here's the questions:

1) Do I need Items #1, #2, AND #3? Or do I just need one of them?

2) If I do indeed need all 3, are payments from 2+ years ago valid or does it have to be in the most recent year?  Are they ignored if they are too far in the past (i.e. 10 years ago)?

I have a history of paying 12 consecutive months of student loans (although it wasn't the same calendar year since it started mid-2016.  Wasn't listed though so I don't know if that counts.

I have paid credit card bills for the past few years consistently, a couple thousand dollars a year. It would be great if that was sufficient.  If not....

I have paid rent, but only 2 years: 2016 (IF you count the months I subletted it for) and 2013.  I'd have to double check if my name is on all those checks though.

I have not paid any cell phone / utility bills a year (6 month comcast bill from 2016, can't find my 2013 data).

3) I'm looking to buy a property in just a couple months so this won't help now, but for the future: I currently live at home, I pay rent in cash with no lease.  Would it be smart to:  pay one of my parents utility bills (and have them reimburse me?)  And write up a lease so I am paying rent formally instead of informally?



@Amil D. You might be a good candidate for www.NACA.com.

They have a few hoops to jump through, but $0 down, no closing costs and fixed, below-market interest rates.

If you were looking south of Boston, I could help, but not north shore or NH. Maybe another agent who has signed on to work with NACA can chime in.

Charlie MacPherson, Real Estate Agent in MA (#9532146)

hi Charlie,

Thank you for the reply! Do FHA loans fall under the category of "NACA" or vice-versa? Or are they similar/used interchangeably? I have never heard of NACA before.



@Amil D.   You can get some great advise here but go right to source... call a bank you are interested in using and ask them what qualifications they need to lend to FHA.

A smaller bank can usually forward your exact situation to the underwriter (the person who actually yay or nays your loan) and get a quick vibe of whether they would lend to you or not.

Good luck - Jim

Thanks Jim, I’ll give it a try!

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