VA Loans With Bad Credit And No Overlays Mississippi
This BLOG On VA Loans With Bad Credit And No Overlays Mississippi Was UPDATED And PUBLISHED On February 8th, 2020
Mississippi is one of the fastest-growing states in the nation.
- A large percentage of our military veterans migrate to the state of Mississippi due to its great climate and more importantly, due to its reasonable home prices
- Unlike Florida, Texas, Georgia, California, Arizona, Colorado, California, Michigan, Indiana, Kentucky, New Jersey, Pennsylvania, Ohio, values of homes in the state of Mississippi has not skyrocketed
- However, home prices seem like it is going to be increasing in the near short term due to demand for housing in Mississippi
This holds true with military veterans migrating to the state of Mississippi. In this article, we will discuss and cover VA Loans With Bad Credit And No Overlays Mississippi.
Veteran home buyers with a Certificate Of Eligibility can now qualify for VA Loans With Bad Credit.
- VA Loans are hands down the easiest and best home loan program in this country
- Many borrowers who contact me say that their mortgage lender can approve them for FHA Loans but not for a VA Loan
- Why is that?
FHA Versus VA Loans
Here are the reasons why other lenders cannot qualify them with VA Loans with Bad Credit but can qualify them for FHA Loans With Bad Credit:
- The United States Department of Veteran Affairs, or VA, does not have minimum credit score nor debt to income ratio requirements
- Most lenders will have VA Lender Overlays that are higher than FHA Lender Overlays
- Most Lenders will have a 640 Credit Score Requirement
- Others may a 620 score Requirement
- Gustan Cho Associates has no overlays on VA Loans
- We do not have any credit score minimum requirements nor debt to income ratio cap
- Gustan Cho Associates has a national reputation for its ZERO VA LENDER OVERLAYS
- Borrowers can definitely qualify for VA Loans With Bad Credit if they meet minimum VA Guidelines
- VA Loans are much easier to qualify than any other loan program
- VA Loans are the BEST mortgage loan program in the nation
- HOWEVER, only Veterans of the United States Military with a COE, CERTIFICATE OF ELIGIBILITY, can qualify for VA Loans
Just because borrowers are Veterans of the United States Armed Forces with a COE, they still need to qualify and meet VA Guidelines
VA Loans Explained
VA Loans are home loans that are originated through private mortgage companies and banks.
Here is how VA Loans work:
- The United States Department of Veteran Affairs is VA
- VA is not a lender but oversees the VA mortgage process
- VA’s role is to insure VA Loans that are originated and funded by lenders who are VA approved
- The way the guarantee works is any VA Loans that are originated by Lenders that default and goes into foreclosure, VA will guarantee and insure the lender that has originated and funded the loan against losses
- The VA Loan Guarantee by the Department of Veterans affairs allows private lenders to keep on originating VA Loans with no money down and very low mortgage interest rates due to little risk due to the guarantee by VA
- VA Loans is the easiest mortgage loan program to qualify for and qualifying for VA Loans with bad credit is one of the specialties of Gustan Cho Associates
- The United States Department of Veterans Affairs is aware and fully takes into considerations that Veterans often can have bad credit and low credit scores due to being deployed while serving in the United States Armed Services
- There are countless factors where Veterans can have lower credit scores and bad credit
- Due to these circumstances, VA understands when Veterans apply for a home loan
They created very lenient credit and income guidelines when Veterans are applying for VA Loans with bad credit.
Borrower Requirements For VA Mortgages
VA Loans are the best mortgage programs. It has very easy borrower qualification requirements. VA Loans offer one of the lowest mortgage interest rates out of any mortgage loan programs.
Here are general borrower requirements for VA Loans:
- VA Loans do not require any down payment
- 100% down payment on VA Loans
- Not everyone can qualify for VA Loans
- Only Veterans with a Certificate of Eligibility are eligible for VA Loans
- VA Loans are for owner occupant properties only
- One to four-unit properties are eligible for VA Loans
- Gustan Cho Associates has no lender overlays on government and conventional loans
- The only requirement is a 580 FICO
- As long as borrowers get an approve/eligible per Automated Underwriting Approval, Gustan Cho Associates will close on your VA Loan
- There is no debt to income ratio requirements on VA Loans
Why Are VA Loans So Much Easier Versus FHA Loans?
The United States of Veteran Affairs realize that most veterans have lower credit and/or bad credit than the civilian public due to the following reasons:
- Our government view that most veterans do not have had credit established than the civilian public
- This is because of their constant transfers and/or deployment while serving in the Armed Service
- Due to this reason, they either have no credit, little credit or bad credit thus many veterans have little to no credit tradelines
- Most Veterans of the Armed Services do not take on student loans
- This is because, in the event that they do, the military pays for the student loans such as the ROTC college programs and those who are enrolled at any one of the United States Military, Naval, Air Force Academies have government-paid tuition and board
- Most Veterans do not have established credit
- This is because most Veterans do not have automobile loans or other credit
- When a Veteran is deployed overseas, the Veteran often has difficulty in making timely payments on his or her debt back home.
- If the Veteran is deployed overseas and during wartime, missing a few months in payments on his or her bills can easily plummet the Veteran’s credit scores
The United States Department of Veteran Affairs understands this and that is why qualifying for VA Loans with bad credit is easy.
Shopping For VA Loans
Many Veterans will have less than perfect credit after retiring from the military and the VA fully understands that.
- The U.S. VA Guaranty program already accounted for this fact that it is very probable for Veterans to have lower credit scores or bad credit
- VA also has much lenient credit guidelines than FHA Loans
Here Are VA Credit Guidelines Versus FHA Credit Guidelines:
- Waiting period is two years after a Chapter 7 Bankruptcy discharged date to qualify for a VA Loan
- It is the same waiting period to qualify for an FHA Loan
- Waiting period to qualify for a VA Loan after a short sale, foreclosure, deed in lieu of foreclosure is two years
- For FHA, the waiting period three years to qualify for an FHA Loan after a short sale, foreclosure, deed in lieu of foreclosure
- Students Loans that have been deferred for 12 or more months are exempt from debt to income calculations with VA Loans
- HUD does not exempt deferred student loans from debt to income ratio calculations
As you can see, VA credit guidelines are much more lenient than HUD Guidelines.
Why Am I Told I Do Not Qualify For VA Loan But Qualify For FHA Loans?
There is not a day that goes by that I do not get a call from a Veteran who is told that they do not qualify for a VA Loan unless they have at least a 620 or 640 credit score:
- Or that they do not qualify for a VA Loan because their debt to income ratios are higher than 41% DTI
- These lenders tell our heroes misinformation and blatantly lie to them
- These Veteran home buyers may not qualify for a VA Loan with them BUT they do qualify for a VA Loan with a Lender with no overlays
- VA does not have a debt to income ratio requirement
- There is no credit score requirement
If you are told that you do not qualify for a VA Loan due to not having credit scores over 620, please contact us at Gustan Cho Associates at the following contact:
Gustan Cho NMLS 873293
Cell: 262-716-8151 Please Text For Faster Response With Contact Information Including Email Address
Available 7 days a week, evenings, weekends, and holidays to take calls from 50 states