Tucson AZ Home Loan Info


My REALTOR Says You Can Approve My FHA Purchase With A 600 FICO Score, Just Like Wells Fargo

Wells Fargo FHA Program 600 Fico: Mike in Tucson, AZ mortgage lender600 FICO!  3.5% Down!  "A Proactive Approach Because You Deserve It!"  ...and other marketing drivel...

Inside Wells Fargo...

According to an insider at Wells Fargo Bank, this program (nationwide) has resulted in the following since its recent inception:

  1. 10,000 loan applications (Good!)
  2. 5,000 loan rejections (Bad!)
  3. 18 loan approvals (Ugly!)

The rest of the loans are still out there in limbo.  (That's a technical term for "We haven't gotten to your loan yet.  We're busy working on other loans.)

REALTOR Marketing Implications:

  • This is not a profitable segment of your market.  Don't spend a lot of emotional capital or marketing dollars pushing a horse that won't run.
  • These are hard loans to get approved.  Wells Fargo isn't the only bank to agree to accept loan applications under this FHA program, but the results they've had ought to put up a huge red flag for agents hoping to close FHA purchases.
  • Don't beat up your lender.  If you're going to work this segment of your market, make sure you use a lender who knows the guidelines.  The guidelines are VERY strict.  The reason that those 18 loans got approved is likely due to a lot of leg work on the part of the Loan Officer PRIOR to submitting the loan to Underwriting.

 LENDER Marketing Implications:

  • This is not a profitable segment of your market either.  Don't spend a lot of emotional capital or marketing dollars pushing a horse that won't run.
  • Educate your REALTOR friends!  Their buyers will be flooding them with calls because of the marketing pieces done by Wells Fargo and others.  Help them understand how stringent the underwriting guidelines are for FICO scores this low.
  • Do your homework.  Be prepared to lose REALTOR relationships if you and the agent don't tag-team the buyer with the same message.  If your REALTOR has an expectation that her 600 FICO buyer can get a loan--and you don't do it--you're going to lose that relationship.

Implications for my borrowers:  There's A Better Way!

  • It's much easier for me to help you get your credit score up from 600 to 640 than it is to leave you where you are and hope that you can buy a home.  Let's talk!



I'm Mike in Tucson, your preferred Tucson Arizona Mortgage Lender.

NMLS #223495

SUNSTREET MORTGAGE llc ~ Correspondent Mortgage Bank
Offices (AZ) Mesa, Tucson, Sierra Vista, and Nogales.



Comment balloon 63 commentsMike Jones • April 05 2011 03:16PM


Mike - BRAVO!!!  I no longer get irritated when I get silly (yes folks, I consider these calls silly) calls.  Whenever some consumer or prospect tells what some other lender can do for them when I've just told them I can't help them, my response is always the same, "then you should go get your loan with them"

If that doesn't work and they actually want to know why I can't help them, I have no problem telling them why none of my lending sources will accept these types of loan files.  I also let them know that I refuse to work with WF's wholesale division and I tell them why too but that's a whole other post.

Posted by Donne Knudsen, CalState Realty Services (Los Angeles & Ventura Counties in CA) over 9 years ago

Thanks, Mike.  That is one of the most honest and impelling post about credit repair I have seen in quite a while.

Posted by Suzanne McLaughlin, Sabinske & Associates, Realtor (Sabinske & Associates, Inc. (Albertville, St. Michael)) over 9 years ago

That's a pretty telling group of statistics. So I assume this is a bit of bait and switch?

Posted by Karen Fiddler, Broker/Owner, Orange County & Lake Arrowhead, CA (949)510-2395 (Karen Parsons-Fiddler, Broker 949-510-2395) over 9 years ago

HI MIKE!  Nice feature!  I agree - it's easier to raise your score than go through all this to be a part of the 5,000!

Posted by Gabrielle Kamahele Rhind, Broker/Owner (KGC Properties LLC, Tucson Property Management & Real Estate) over 9 years ago


Thanks for the encouragement!


I don't think it's a bait and switch.  There's nowhere for a 600 fico buyer to switch to.  It's purely a marketing thing to keep Wells Fargo top of mind.  Imagine how much it costs, though, to process and deny 5,000 loans!


I believe in credit repair!


Thanks for being the first to comment!  I'll see you on your blog.

Mike in Tucson

Posted by Mike Jones, Mike Jones NMLS 223495 (SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) ) over 9 years ago


You know what I'd like to see in a post from you .... a list of the "magic threshold" numbers and their significance ....  640 ... 660 ... 725 ... 770  (or whatever they are)  :-)

Posted by Cheryl Johnson over 9 years ago

That Realtor needs to know that FHA provides mere "guidelines".  Mortgage companies have company policies that may differ widely from FHA/VA/Fannie/Freddie, etc. 

I seem to recall a time about 6-8 years ago when mortgage companies let Fannie tell them what they must approve. 


I presently have 8 buyers working with a couple of loan officers to bring their credit score up to 640 or 620 in one county.

Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate) over 9 years ago

Mike, VERY well done!  And the solution at the end to the "issue" really sealed the deal for me.

Posted by Lisa Moroniak, SFR - Short Sale & Foreclosure Certified (Keller Williams Realty | Northern Virginia | 703.635.0388) over 9 years ago

Mike, the way you presented this paints a very clear picture of the WF program, and why it's best to let you help them get that credit score up.  Great read!

Posted by Melanie Serrato, CA Realtor - Corona-Norco-Eastvale Homes (Melanie Serrato, Rawlings Realty ~Corona, Norco, Eastvale Ca) over 9 years ago

You are so totally right Mike. When I see buyer's come in over list price with this type of financing terms and asking seller's to cover closing costs and I know where this is going. The deal invariably fails and the seller is sore at me for letting him sign it.

Posted by Randy Harden MBA, www.RERandy.com (CENTURY 21 Wieder Realty) over 9 years ago

Wow!  Those are powerful stats. 

I didn't think it was a good idea to start.  I would like to see the time period to re-purchase after a short sale shortened rather than lowering credit standards across the board. I see a lot of people who only have that one credit event who are locked out and otherwise have great credit.

But, it looks like that was just a mirage anyway.

Posted by Tni LeBlanc, Realtor®, J.D., Tenacious Tni (805) 878-9879 (Mint Properties, Lic. #01871795) over 9 years ago

I thought it sounded too good to be true. Why not just go back to no doc loans?

Posted by Jeff Pearl over 9 years ago


Try First Mortgage Corp out of Diamond Bar, CA. They can and willa ctually do these loans and getting them through is not brain damage.

Posted by Chris "The Loan Ranger" McBrearty, NMLS 274079, FHA, VA, USDA, Loan Officer and Educator (Fairway Independent Mortgage, DBO/CRMLA #41DBO-78367, NMLS #2289) over 9 years ago

Amen!  You are spot on with this!  WF makes things tough on everyone when they throw this stuff out there!

Posted by Jeani Codrey, If you're not learning, you're not living! (The Learning Jeani) over 9 years ago

Wow - I haven't heard about this!  I'm not taking a Buyer out with less than a 640. Period.

Posted by Lori Cain, Midtown Tulsa Real Estate Top Producer (eXp Realty) over 9 years ago

Wow, that is alot of disappointed buyers,  And sellers! Thanks for the heads up on this.

Posted by Dick and Dixie Sells, Realtors, Tampa Bay Florida Homes For Sale (Sells Real Estate, LLC) over 9 years ago

We are fortunate to have a portfolio FHA product that goes down to a 500 score...however, there may be only one person in the country that actually qualifies with that 500.  The program is better suited for someone with a 580, just closed one last month and it was not that difficult. 

Primary Residential Mortgage has branches in AZ too in case you are looking for a new place to hang your hat.

Posted by Kevin Kueneke, San Diego Mortgage Banker (Caliber Home Loans) over 9 years ago

WOW!!!  First Mortgage, that's one I haven't used in a long time.  I used to use them because they used to be a great lender for borrowers using dpa programs, which is my niche.  I stopped using them though because they became really difficult to work with. 

While I wouldn't define working with them as brain surgery, they were definitely a PITA.  As such, they are no longer one of our Tier 1 lending sources but I guess if you really need some freaky loan exceptions, they would be someone to check out.  However, be careful of their adjustments.

Posted by Donne Knudsen, CalState Realty Services (Los Angeles & Ventura Counties in CA) over 9 years ago

You made my day with this.

Posted by Robert Staab (None currently nmls# 509659) over 9 years ago


It's easy to waste the time of our customers as well as our time. Thanks for sharing the information.

Good luck and success.

Lou Ludwig

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) over 9 years ago

Earth to Wells Fargo, Earth to Wells Fargo: Please return as soon as possible!

Posted by Dave Halpern, Louisville Short Sale Expert (Keller Williams Realty Louisville East (502) 664-7827) over 9 years ago

Those are some really dismal figures. I will be prepared for those phone calls and alot of disappointed clients.

Posted by Rosalie Evans, The Evans Group, Sioux Falls, SD Homes For Sale (Meritus Group Real Estate) over 9 years ago

AMEN!!!!!  great, job pointing the truth out.  Some thing to remember, if only Wells Fargo is doing the program then its going to be TUFF loan type to get approved.  if it was easy or not so risky then everyone would do them. 

Posted by David Krichmar, DaveYourMortgageGuy.com (www.DaveYourMortgageGuy.com - Legend Lending) over 9 years ago

A nice breath of honesty... We just had the Wells Fargo people in our office two weeks ago preaching about being able to do this.  "no problem this, no problem that."  It's really nice to just have it laid out.  It would be great if you had a clone in Louisville, KY

Posted by Dave Lambrechts over 9 years ago

If you think this is bad just wait until there is no competition!

Think about Wells Fargo collecting 10,000 applaction fees and only taking 18 risk.


Posted by William J. Archambault, Jr. (The Real Estate Investment Institute ) over 9 years ago

Hi Mike -- Thanks for telling it like it is.  If the dog won't run, it needs to get back on the porch until it can.  Your post illustrates why a buyer (and buyer's agent) need to partner with an exceptional loan officer (like you) who knows there stuff.  To do anything else is throwing fate to the wind, and I hate being downwind on a windy day!

Posted by Chris Olsen, Broker Owner Cleveland Ohio Real Estate (Olsen Ziegler Realty) over 9 years ago


Thanks for adding some sense to the argument that less then stellar credit scores can get loans. Some do, most don't.

Posted by Richard Weisser, Richard Weisser Retired Real Estate Professional (Richard Weisser Realty) over 9 years ago

think about it.

you're no longer turned down because of the score, but the actual credit history which creates that score is not acceptable.

Posted by Jay Beckingham, Seniors ROCK! (Christensen Financial Mortgage) over 9 years ago

Home run Mike, I actually wondered how may loans actually got closed with these guidelines. I too prefer helping a borrwer rise their score then try to do a loan under 620.

Posted by Markita Woods NMLS#196099, Queen of Mortgages - FHA, VA, Conventional, USDA (American Financial Network) over 9 years ago

I too believe in getting the best score you can for all the obvious reasons.  There are a few buyers who with compensating factors can qualify for a mortgage with a score less than 640, but they are very closely scrutinized.


Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) over 9 years ago

Great post Michael. 


I know it's not MLK day....but "I HAVE A DREAM".   A dream of a day with NO overlays or declining/distressed markets.  It's a beautiful place...where FHA FLIPs can close without the need for Medical Marijuana.....  QUALIFIED investors can buy as many houses as they can financially qualify for...... and FHA files are not giving any consideration to credit score.  Jumbo financing at 90% is available and the Phoenix Suns are in the play offs.

Please don't wake me.

Posted by Brent Alan McDonald, Serving your family like they are our family (All Western Mortgage, Inc NMLS 1744198) over 9 years ago


Thanks for the comments!


10,000 application fees.  Hadn't thought about that; it's a lot of money!

Mike in Tucson

Posted by Mike Jones, Mike Jones NMLS 223495 (SUNSTREET MORTGAGE, LLC (BK-0907366, NMLS 145171) ) over 9 years ago

Dear Mike,

Your post was so clearly stated and then the comments really amplified your statements.

The credit score repair path is the best one to take.  Great advice!

Have a happy day -

Posted by Lynn B. Friedman, Concierge Service for Our Atlanta Sellers & Buyers (Atlanta Homes ODAT Realty Call/Text 404-939-2727 Buckhead - Midtown - Westside -- and more ...) over 9 years ago

Now, now, Mike, I have to be the bad apple here - why didn't you wave your magic wand and make all of these loans APPROVED, APPROVED, APPROVED, like they say in the commericals, LOL. 

Seriously, what I hope that people will work TOWARDS as a goal, is teaching people RESPONSIBLE credit habits.  It's typically not taught at school and should be a mandatory course.  How many of us got into trouble over a credit card when we got that first one?  I DID. 

I used to teach the MGIC course on first time homebuyers and it was very eye opening.  Planning for the future problems, budgeting, etc.  I think EVERYONE should have this available to them.

Posted by Juli Vosmik, Scottsdale/Cave Creek, AZ real estate 480-710-0739 (Dominion Fine Properties) over 9 years ago
Thanks for highlighting this product. You learn a lot on AR!
Posted by Cheryl Ritchie, Southern Maryland 301-980-7566 (RE/MAX Leading Edge www.GoldenResults.com) over 9 years ago

Well said. Getin those 40 points on your credit probally isn't hard at all.

Posted by Scott Fogleman, Greater Good Group (New Home Team 804-573-9592) over 9 years ago

But, but.. but .. but. .




Posted by Fernando Herboso - Broker for Maxus Realty Group, 301-246-0001 Serving Maryland, DC and Northern VA (Maxus Realty Group - Broker 301-246-0001) over 9 years ago

Hi Mike very good to know - I won't have my buyers waste their time with that.  I think you on the right track - repair your credit first and get your score changed -


Posted by Laurie C. Bailey-Gates, ABR, SFR (Robert Paul Properties) over 9 years ago

One of our tenants has been trying to get their FHA loan approved since August 2010. 9 months, and still counting.

It's never been rejected, and the bank has paid for 3 appraisals so far.....

Posted by Darrin Carey, Real Estate Lender for Investors (Dayton Capital Partners LLC) over 9 years ago
Great post. Congrats on the feature. Wow bad numbers for Wells.
Posted by Trisha P Realty Group, "Holding the Keys to Your Dream Home" (Realty Executives) over 9 years ago

I only hope that Wells Fargo (and every loan professional) has the courtesy and accountability to inform the applicant of the likelihood of success upon reviewing the submission.  This is a service that not enough prospective buyers know to expect, but I feel it's one that is across-the-board provided by the true professionals in our line of work.  I hope that never changes despite the direction I see regulation pushing our industry.  Great post --- thanks.

Posted by Rob Spinosa, SVP of Mortgage Lending, Marin County (Guaranteed Rate, Marin County, CA) over 9 years ago

Mike - I got an e-mail last week from somebody saying he could get an FHA with 580!!!! I wish mortgage people would NOT say things like this since it isn't going to happen! Great post!

Posted by Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional, Palm Harbor, Dunedin, Clearwater, Safety Harbor (Charles Rutenberg Realty) over 9 years ago

Mike: Great advice. I think the old adage "if it sounds too good to be true, it probably is" applies herre. It's easy to think there's an easy way but in the long run, tried and true usually wins out. The other thing is it may take about the same amount of time. Going from 600 to 640 may take 60 days or so but we all know how long it takes Wells to approve loans! Thanks again for the post!

Posted by Paul McFadden, Pest Control, Seattle, WA. (Paratex) over 9 years ago

Mike, this doesn't seem to be worth the effort for only 18 approved loans. Raising the credit score is the only way to go.

Posted by Michael Setunsky, Your Commercial Real Estate Link to Northern VA over 9 years ago

Mike Thanks for speaking out for the rest of us in the lending arena.

Posted by Jim Poole, Zero Down, USDA Purchase Loans, FHA 203(K) Rehab & VA Streamline Loans over 9 years ago

I wondered about this myself because I've seen marketing pitches in California from Wells Fargo promising FHA loans with a FICO score of 500. I don't work much with those type of borrowers so I've no first-hand experience, but from what you're saying, the adage: if it sounds too good to be true it's not rings loud.

I also heard from a reliable source yesterday that Wells Fargo is making FHA loans to borrowers who were current on their mortgages and doing a short sale. That WF can do that loan concurrently (presumably before the "paid in full for less than agreed" hits). The other lenders I've heard talk about this type of FHA loan have overlays that say the borrrower must move 600 miles away, which pretty much eliminates every short sale seller-turned-borrower in California, no?

Posted by Elizabeth Weintraub Sacramento Realtor Top 1%, Put 40 years of experience to work for you (RE/MAX Gold) over 9 years ago

Great post! I was a mtg broker for 15 years. This is kinda like those special modification programs that take Thousands of people and approve like 6- come on! I have always showed people how to get their scores up- now it is imperative.


Posted by Anonymous over 9 years ago

FANTASTIC post, Mike.  I think a lot of people focus on what we used to be able to do to their detriment, complaining: "If we could just get those low scores approved, we could move some houses"!  Not a good plan of attack.  We are, as you say, much better off focusing on a more highly quailfied buyer than trying to push through these tough loans.


Posted by Brett Reichel, MLO 210215 (Homebridge Financial Services) over 9 years ago

Mike - I haven't used Wells Fargo for 5 years, and this is one of the reasons why, they never could get a loan closed on time, and they give their own customers bad service.

Posted by Larry Brewer - Benchmark Realty llc (Benchmark Realty LLc) over 9 years ago

Mike - Great post!  Thanks for the stats on this!  I had heard something to this effect, but hadn't seen any hard numbers like this.  When I get those calls from clients and realtors, I've just told them, "sure I have the same program, but the likelihood it will go through is slim because these are the additional guidelines...no lates in the last 12 months, etc...how many people do you think have this kind of score and fit into these other credit guidelines?"  I agree with everybody else on here that it's easier to help them raise their scores over the course of a few months.  First Mortgage has never stopped doing these, but it isn't easy to get one through...Plaza Home Mortgage has just announced they'll go down to 580; I suspect it's under similar strict guidelines, as well.  I wonder how many loan officers are even going to attempt these anymore under the new compensation rules...  It's nice saying you have the program, but it's nicer to tell everybody what they're getting into if they want to try to get approved on the program!

Posted by Brett Pehrson (Advanced Funding Home Mortgage, NMLS#13287) over 9 years ago

BTW, Mike.  I hope you don't mind, but I'm going to re-blog your post!  I think people need to know this info!  Thanks again!

Posted by Brett Pehrson (Advanced Funding Home Mortgage, NMLS#13287) over 9 years ago

Wonderful! I'd work with you if I were in Arizona, Mike. :)

Posted by Cheriamor Houston, ADPR, CNE (Coldwell Banker Residential Brokerage) over 9 years ago

You are right that many of these folks don't qualify and even the ones that do can be a lot of work.  There is so much more to the process than the score.  Often these folks can't qualify just because of debt to income ratios, which shouldn't take any competent loan officer long to figure out.  Our company can do FHA down to 580 with the minumum FHA down payment and to 540 with a larger downpayment.  That said, they still have to meet all of FHA's other requirements and of course there can be no disputed accounts.

We have personally closed several loans for folks with scores between 580 and 620 in the last few months and one for a borrower with a score below 580, so we know it can be done.

Posted by Bill Rozek, NMLS #214260 (Embrace Home Loans, Inc.) over 9 years ago

As important as it is (or may be) to purchase a home, it is equally or more important to increase your credit score anyway. You might as well. Why not make it that much easier and faster for yourself??!! Credit scores effect more than just the ability to purchase a home!

Posted by Cheriamor Houston, ADPR, CNE (Coldwell Banker Residential Brokerage) over 9 years ago
Thanks Mike, for sharing this information.
Posted by James Loftis, RealEstate911.com (RealEstate911.com) over 9 years ago


Great post.  I usually tell my Realtors that while I can go to 600, there is usually a reason that borrower is 600 and that reason is almost always covered in the other credit overlays.

Posted by Bradley Eggers (Midwest Equity) over 9 years ago

This is one of the best  posts I've seen on this subject.  Thanks for bringing this important information to everyone's attention.  I've felt like I have been a lone voice in the wilderness on this subject. 

Posted by Doug Bullwinkel, Mortgage Loan Originator NMLS #281609 (Envoy Mortgage,NMLS ID 6666) over 9 years ago
GREAT POST!!!! The big boys don't always have the best answers! You are absolutely right about raising a score quicker than dealing with one below 640. Great post!
Posted by Stephen-Michael Washington, FHA and VA Mortgage Loans Alabama (Pre-Approval, First Time Buyer, Fixed Rates) over 9 years ago

Mike I read activerain blogs about every day.  This may be the best I have read.  I'm glad you are in AZ and not NC.  I would hate to compete against you.  I'm looking foward to more blogs from you.

Posted by Shay Campbell, Raleigh, NC (Universal American Mortgage Company) over 9 years ago

Mike - Those are some stats that I never knew. It seems like a client is just a number on the desk sometimes.

And 620 FICO is the target for many. People need to get guidance from all of you lenders to get on track.

Posted by Ken Barker Realtor® GRI, E-Pro Certified (Dilbeck Real Estate) over 9 years ago

I haven't read the comments, so this may have already been said...  If they can't deliver on this product, wouldn't it be considered false advertising?  Seems like there should be some sort of requirement that says, if it won't work (can't be delivered), don't sell it!  


Posted by Doreen McPherson, Phoenix Arizona Real Estate ~ (Homesmart ~ Scottsdale ~ Tempe) over 9 years ago

Actually, I'm sure they promote it knowing few will qualify... isn't that called bait and switch?  =-)

Posted by Doreen McPherson, Phoenix Arizona Real Estate ~ (Homesmart ~ Scottsdale ~ Tempe) over 9 years ago

No, Bait and switch means they get you interested in one service, aka low score loan with the intention of switching you to a different product like credit repair. Unless wells fargo offers this service directly then its not a bait and switch.

Posted by Tyler over 9 years ago

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