VA Minimum Credit Score Requirements On VA Home Loans

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VA Minimum Credit Score Requirements On VA Home Loans

This BLOG On VA Minimum Credit Score Requirements On VA Home Loans Was PUBLISHED On June 2nd, 2019

The United States Department of Veterans Affairs (Referred to as The VA), has created and launched the VA Home Loan Program for our men and women of the United States Armed Services. Veterans of the United States Military with a valid Certificate Of Eligibility (COE) can qualify for VA Home Loans with 100% financing and no down payment:

  • Our government wanted to show our appreciation for active and retired members of the U.S. Military by creating the VA Loan Program for their service
  • The VA Loan Program has the most lenient mortgage guidelines versus other loan programs
  • For example, it is a three year waiting period after a foreclosure, deed in lieu of foreclosure, short-sale to qualify for FHA Loans
  • The VA’s waiting period requirement after foreclosure, deed in lieu of foreclosure, short-sale is two years
  • All loan programs have a minimum credit score requirement with the exception of VA Loans
  • VA Mortgages has no VA Minimum Credit Score Requirements with an approve/eligible per automated underwriting system (AUS)
  • The Veterans Administration does not have a maximum debt to income ratio requirements with an approve/eligible per AUS
  • With such lenient credit/income guidelines, VA Loans remain to be the best performing residential mortgage program for decades

However, to get a VA Automated Approval, the borrower should have a lot of residual income. In this blog, we will discuss VA Minimum Credit Score Requirements and other pertinent Guidelines.

VA Agency Guidelines Versus Lender Overlays On VA Loans

Over 75% of our borrowers at Gustan Cho Associates are folks who could not qualify at other lenders due to their lender overlays. These borrowers met VA Agency Guidelines but not the lender overlays who they initially consulted.

  • There are two types of VA Lending Requirements
  • VA Agency Guidelines Versus Lender Overlays
  • VA Agency Guidelines are the minimum VA lending requirements per the U.S. Department of Veterans Affairs (The VA) to get an approve/eligible per automated underwriting system (AUS)
  • Lender Overlays are additional VA Lending Requirements imposed by individual mortgage lenders
  • Just because a borrower may meet all VA Agency Guidelines and gets an automated AUS Approval does not mean they will qualify with all lenders

Gustan Cho Associates at Loan Cabin Inc. are direct lenders with no VA Lender Overlays on VA Loans. We do not have any additional mortgage lending guidelines on VA Loans. We just go by the automated findings on the AUS. As long as you get an automated underwriting system approval and can meet all conditions, then your VA Loan will not only close but will close on time at Gustan Cho Associates.

The VA Eligibility Mortgage Guidelines On VA Loans

Only active and/or retired members of the United States Military with a valid Certificate Of Eligibility (COE) are eligible to qualify for VA Home Loans. Below are the minimum VA Agency Guidelines:

  • 100% financing with no down payment required
  • Up to 4% in sellers concessions by home sellers for buyer’s closing costs
  • There is a two-year waiting period after bankruptcy, foreclosure, short-sale, deed in lieu of foreclosure to qualify for VA Loans
  • Outstanding collections and charge off accounts do not have to be paid off 
  • There is no VA Minimum Credit Score Requirements on VA Loans as long as borrowers can get an AUS Approval
  • There is no maximum debt to income ratio requirements on VA Loans as long as borrowers can get an AUS Approval
  • Borrowers in Chapter 13 Bankruptcy Repayment can qualify for VA Loans one year into the repayment plan with Trustee Approval and manual underwriting
  • Chapter 13 Bankruptcy does not have to be discharged as long as the borrower is making timely scheduled monthly payments
  • There is no waiting period to qualify for VA Loans after Chapter 13 Bankruptcy discharge date

For more information on this blog or other mortgage-topics, please contact us at Gustan Cho Associates at 262-716-8151 or text us for faster response. Or email us at gcho@loancabin.com.

 

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