Question

 

Title: Mortgage Blog 175

Category: Real Estate Keyword: VA Loan With Bad Credit

Word count: 800 Time: 2hrs

Special instructions: Topic: How To Get A VA Loan With Bad Credit Must have Subheadings and have the keyword in it at least once No Keyword stuffing Use 'VA Loan With Bad Credit' in a subtitle Use Keyword variations Keyword must be used at least 2% and no higher than 3.5% No Copywriting Will Be Checking Spelling and Grammar

Reference: https://www.vahomeloancenters.org/how-to-get-a-va-home-loan-with-bad-credit/

Creative Brief Things to Mention: VA Loan With Bad C

Answer 1

VA loans with bad credit:

The departments of veteran affairs don’t actually lend money. They simply guarantee the mortgage. Though there are majority of lenders who require the 620 score, there can be others willing to grant loans & hence it is necessary to keep checking with many VA lenders even if one has rejected.

VA loans with bad credit are actually easy to qualify if:

• There are no outstanding collections.
• No outstanding judgments.
• Stable income for a period of 2 years
• A median credit score of 620 or higher.
• No late payments in past 12 months.
• Maximum DTI ratio of 43%
• 2-3 months of bank statements.
• 2 months of mortgage payment in reserves.

There are compensating factors which can increase the chance of getting the loans approved even with poor FICO score. They can include factors like large down payment, high income, length of time at current employer & low amount of debt.

Many veterans who has spent time in overseas lack positive credit. Whereas others lack funds for down payment. To change this, government introduced a method to assist the veterans by helping them to get a farm or a home. The credit score must be at least 620 to get loans. However there are VA loans for some borrowers who have a score less than 620. If there is no credit, then qualification must be determined on the basis of past payment history of rent, car insurance & other regular monthly expenses.

Late payments won’t result in automatic denial. If there are any open collection accounts, still one can be considered eligible as long as there are timely payment plan.

In case of chapter 7 bankruptcies, if two years have been completed on discharge of bankruptcy, then it will not play a role in determining a satisfactory credit.

A chapter 13 need not be discharged and still one can qualify for chapter 13 bankruptcy as long as the debt is repaid as agreed.

In order to ensure acceptable credit, there can’t be too many inquiries in the credit report. In that case, the credit rating keeps dropping dramatically. In addition to low score, multiple credit inquiries can look like new lines & this can affect the ability to repay the debt. Because of this multiple credit inquiries, there can be a delay in the loan getting approved.

The last thing that one has to be aware of to get a loan is that there must not be any savings or checking overdraft fees.

The VA actually doesn’t mandate a minimum score requirement & credit score benchmarks can vary by lender. Some lenders will be willing to go below the 620 cut off by dividing line between “fair & subprime credit”. The latter category is considered as a bad credit.

There is also mortgage program for poor credit scores. FHA loans are one of the most popular type of home loan products used today & they are best suitable for people with low credit scores.