This blog will share some helpful tips about VA credit dispute guidelines. VA loans are often seen as one of the most excellent mortgage options available in the U.S.. Still, it’s important to remember that not everyone is eligible for them. Only active or retired members of the U.S. Armed Forces can obtain a VA loan, provided they have a certificate of eligibility (COE).
VA loans have less strict criteria than other governmental or conventional loans. For instance, there is a two-year waiting period following a bankruptcy or a housing situation such as foreclosure, a deed in lieu, or a short sale. Additionally, VA loans do not have a minimum credit score requirement or a maximum debt-to-income ratio.
Gustan Cho Associates is a mortgage company licensed in multiple states that does not impose additional requirements (overlays) on VA loans. When disputing credit issues for a VA loan, the process is similar to disputing credit for other types of loans. In the following paragraphs, we will outline the general steps to take.
VA Credit Dispute During Mortgage Process
Per VA Credit Dispute Mortgage Guidelines, credit disputes are not allowed during the mortgage process. Medical collections are exempt from VA Credit Dispute Retraction Guidelines. Per VA Credit Dispute Lending Guidelines, there cannot be any non-medical credit disputes.
VA guidelines require borrowers to remove disputes on non-medical collection accounts during the loan process. Only medical collection disputes are generally exempt.
Non-medical credit disputes can halt the mortgage process until resolved. Collections with a zero balance and non-medical accounts with less than $1,000 owed don’t have to go through the dispute removal process. Loan officers should refrain from issuing pre-approval letters to borrowers with outstanding credit disputes unless they fall under the exempt categories.
Reasoning Why VA Credit Dispute Are Not Allowed By Lenders
VA needs borrowers to handle any credit disputes because having them can mess up credit scores. When someone disputes a bad credit item, the credit agencies ignore that negative factor in their scoring. That’s why scores usually go up when people file disputes. But once those disputes are resolved, scores often drop again. A loan officer shouldn’t issue a pre-approval letter when there are still disputes hanging around since the automated system might not give accurate results in that case.
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Exempt From VA Credit Dispute
Charge-off accounts, unpaid collections, late payments, judgments, and tax liens can’t be disputed. Also, some credit disputes don’t need to be taken off your record. For instance, collections under $1,000 or medical collections are usually left as is. If someone has accounts linked to identity theft, they can get those disputed as long as they have a police report or something from the creditor showing they’re a victim of identity theft.
When mortgage underwriters look at a loan application, they pay close attention to whether the borrower can actually repay the mortgage, which is why having an accurate credit score and a solid payment history is crucial.
How To Remove Credit Dispute
Borrowers can try to remove credit disputes directly by clicking this link: HOW TO REMOVE CREDIT DISPUTES. We will go over the general steps in removing credit disputes. Get access to a consumer credit report through annualcreditreport.com or another service provider. The first step is to request a consumer credit report by the following credit bureaus:
- www.experian.com
- www.equifax.com
- Go over the accuracy of credit tradelines
- Retract the disputed credit tradelines by notifying the credit bureaus
Phone Numbers To Retract VA Credit Dispute
Here are the phone numbers to the three major credit bureaus:
- TransUnion Dispute Department: (800) 916-8800
- Experian Dispute Department: (800) 493-1058
- Equifax Dispute Department: (800) 203-7843
Start by contacting the creditor and asking them to drop the dispute. If they’re not helpful, write to the credit bureaus to ask them to reverse the dispute. When calling, be ready to verify your identity and clearly state that you want to remove a dispute from your credit report for mortgage qualification purposes.
How To Write A Letter When You Need To Retract Credit Disputes
Please contact Gustan Cho Associates for more information on retracting credit disputes during the mortgage process and qualifying for a mortgage. Borrowers who need to qualify for a mortgage with a mortgage company licensed in multiple states with no lender overlays on government and conventional loans, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.
Gustan Cho Associates has a national reputation of being a one-stop mortgage lending shop. Gustan Cho Associates does not just have no lender overlays on government and conventional loans, but we have lending partnerships with over two dozen non-QM wholesale mortgage lenders. If there is a mortgage loan program available in today’s market, you can rest assured Gustan Cho Associates has it available. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.
Review Credit Reports For Errors and Inaccuracies
Review Your Credit Report by getting a copy of your credit reports(Equifax, Experian, and TransUnion). Get a free copy of your credit report from each bureau at AnnualCreditReport.com once a year. Identify Errors:
Carefully review each credit report to identify any inaccuracies, errors, or discrepancies. This could include incorrect account information, outdated information, or accounts that belong to someone else.
Collect any supporting documentation proving your credit report’s inaccuracies. This could include statements, receipts, letters, or other relevant documents. Contact the credit bureaus in writing to dispute any inaccuracies you’ve found on your credit reports online, by mail, or by phone. Be sure to provide clear and specific details about the errors and include copies of any supporting documentation.
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VA Credit Dispute By Contacting Creditors
If the inaccuracies involve specific accounts, you may also need to contact the creditors directly to dispute the information. Please provide them with the same documentation you provided to the credit bureaus. Follow-up:
Keep records of all communications with the credit bureaus and creditors, including dates, names of representatives, and any reference numbers. Follow up regularly to ensure that your disputes are being investigated and resolved.
Wait for Resolution: The credit bureaus typically have 30 days to investigate your disputes and respond to your request. During this time, they will contact the creditors to verify the information. If the information needs to be more accurate, the credit bureaus will update your credit report accordingly.
Review Updated Credit Report
Once the investigation is finished, check your updated credit report to confirm any mistakes have been corrected. If you are applying for a VA loan or already have one, let your lender know about any credit disputes and send them copies of the updated credit reports after the errors are fixed. After resolving the disputes, keep an eye on your credit regularly to make sure the mistakes don’t come back and to maintain good credit health.
Fixing errors can boost your credit score, but it doesn’t guarantee that you’ll be approved for a VA loan or any other type of loan. When deciding about your loan application, lenders consider several factors beyond your credit history.
Frequently Asked Questions About VA Credit Dispute:
Q: Can I Get a VA Loan if I have a VA Credit Dispute?
A: You usually can’t move forward with a VA loan if you have an open VA credit dispute. Most disputes need to be removed first—unless they’re medical bills or collections under $1,000.
Q: What is a VA Credit Dispute?
A: A VA credit dispute is when you challenge something negative on your credit report while applying for a VA loan. These disputes can freeze the loan process until they’re resolved.
Q: Do I have to Remove a VA Credit Dispute Before Getting Approved?
A: Yes, in most cases. VA credit dispute rules require you to resolve any non-medical disputes before your lender can issue full loan approval.
Q: Are There Any VA Credit Disputes I Don’t Need to Remove?
A: Yes. You don’t have to remove VA credit disputes if they’re for medical collections, collections under $1,000, or identity theft (with proof).
Q: Why does a VA Credit Dispute Affect My Credit Score?
A: When you file a VA credit dispute, credit bureaus stop counting that bad account in your score. It makes your score look better than it really is—so lenders want disputes removed to see your real score.
Q: How do I Remove a VA Credit Dispute from My Credit Report?
A: You can call or write to the credit bureaus (Experian, Equifax, TransUnion) or the company reporting the account. Let them know you want to take back the VA credit dispute so your loan can move forward.
Q: Can I Still Get Pre-Approved if I have a VA Credit Dispute?
A: Not usually. Most lenders won’t issue a pre-approval if you have a VA credit dispute unless it’s for medical bills or under $1,000.
Q: What Happens if I Ignore the VA Credit Dispute During the Loan Process?
A: Your VA loan could be put on hold or denied. The lender’s system might not give accurate results with a VA credit dispute on your report.
Q: How Long does it Take to Remove a VA Credit Dispute?
A: It can take a few days to a few weeks. Once you call or write to the credit bureaus, they usually update your report quickly, especially if you follow up.
Q: Who can Help Me with a VA Credit Dispute if I’m Stuck?
A: You can contact Gustan Cho Associates. They assist borrowers in getting approved, even if other lenders reject them because of VA credit dispute problems.
This blog about “VA Credit Dispute Guidelines During Mortgage Process” was updated on April 24th, 2025.
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