How much does credit weigh when obtaining a VA guaranteed home loan?
So my problem isn’t that I have bad credit, but that I don’t have much credit established. When I check my credit scores online they seem to be “Good”, but I haven’t ever been able to get approved for hardly anything (such as a car) because I don’t have very much on my credit history. I’ve now had two credit cards who’s balances have increased to triple the original limit because I’ve always made payments on time. I pay the full balance off each month. I have one student loan that is completely paid for as well. It’s getting there…slowly but surely!
After I get home from deployment I’ll be eligible for a VA home loan and am wondering if I’ll need to build more credit before being approved, or if VA home loans don’t require an extensive credit history like most other loans. I’m young, but me and my wife would really like to get out of an apartment and fit our growing family into something more appropriate.
We also plan on putting 10-15% down.
The VA has made it easier for Veterans to qualify for a VA loan since the VA guarantees a loan up to $417,000. If you are a VA compensated disabled veteran, the VA will also waive the VA funding fee (saves up to 2.15% of the loan value).
There is a credit check and your income must be sufficient to enable you to pay the Principle, Interest, Taxes (real estate), and Insurance (PITI) and have sufficient funds left over to pay your and your families daily expenses. Contact any bank or credit union loan officer and ask them to check you eligibility (do not recommend using a Realtor for this – use people who make home loans). The loan agent can quickly calculate your maximum loan amount based on your income. The VA home loan program takes away the need to have a lot of money upfront for the down payment. The VA home loan fee can be financed into the basic loan. Lenders like the VA because their risk is less since it is guaranteed by the VA.
For more detailed info, go to the following VA website: www.homeloans.va.gov . The site has Frequently Asked Questions, lays out the program in detail, and will help you ask the right questions.
@Jeepers – The $25,000 VA guarantee amount stretches back to the 1970s. It has been increased numerous times since then. It is now $417,000; however, there are certain cases in which it can be higher.
USMC-Retired. Previous user of a VA home loan.
Note: You can also assume another’s VA home loan associated to the house that you are interested in buying. It may give you better interest rates.
