Want to get a VA Home Loan with a Credit Score 550: Consider These 3 Things
A VA loan is a home loan available through a program established by the United States Department of Veterans Affairs. The VA puts the qualifying standards, dictates the term of the home loans offered, and guarantees a part of the loan, however, it does not actually offer the financing. VA home loans are offered by private lenders. If you are a veteran, a military officer, or a surviving spouse you can apply for this loan and fulfill your dream of homeownership.
But if your credit score is low, you may keep wondering whether you can get approval for the loan. Well, there are lenders, who offer VA home loan credit score 550 in Houston, Tx. Besides, there are several things that can make you eligible to get the approval irrespective of having low credit.
Check for credit mistakes
There are several things that can affect your credit score, and one of the key ones of them is your credit mistakes. And the common ones are not paying the debt on time and applying for new credit. If your credit score is already low, these mistakes can drastically affect your credit score. So, make sure not to make these mistakes. Besides, you should check whether there are any credit errors. If there is any, rectify these as early as possible. Even a little increase in the credit score can help you a lot.
Come with a decent down payment
As the credit score requirement for a VA loan is decided by a lender, it varies from a lender to another one. And although the VA does not ask for a down payment, lenders ask for this, and the requirement varies too. One asks for a low down payment while another one can ask for a high down payment.
But if you want to be on the safe side, it is better to come with a big down payment when you are about to apply for a VA loan with a low credit score. High down payment helps you get the approval with low credit. Besides, it can also help you qualify for the lowest mortgage rate. So, make effective measures to come with a high down payment.
Shop for lenders
As it is already mentioned, the VA loans are not approved by the U.S. Department of Veterans Affairs, but by the VA lenders. And as there is no fixed guideline that the lenders need to be followed when approving the loan, the lenders set their requirements individually. So, the eligibility criteria vary from a lender to another one. Without comparing, it would be difficult for you to understand, who is asking for the lowest mortgage rate. This is why; you need to ask for quotes from different lenders. Once you get the quotes, compare it, and then opt for the one that will be suitable for you.
These are some of the things that can help you to get approval for a VA loan with a low credit score. So, focus on these things and ensure approval from a reputable lender.
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.