is there a min credit score for a VA purchase loan?

Asked by Clyde Jackson, Kirkland, WA Fri May 13, 2011

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Rhonda Porter, , Seattle, WA
Tue May 24, 2011
Chuck, lenders will look at the middle credit score of all borrowers and use the lowest middle score. The lowest middle score that many lenders have their underwriting guidelines is 620. So it's possible that a borrower can have 580, 640 and 620 for their credit scores (borrowers typically have 3 credit scores) and still qualify since 620 is "the middle".
Underwriters are also going to look at your last 1-2 years of credit history to make sure there are limited late payments.

Also be aware that the credit scores that you have access to online are different than those that a mortgage originator will pull.

If you find your credit scores are lower than what will meet guidelines, it might just take a few adjustments to help get your scores in a better position. The higher your mid-credit score is, the better your mortgage rate may be.

If I can be of assistance, please let me know.
0 votes
Chuck Chrobak, Mortgage Broker Or Lender, Mill Creek, WA
Mon May 16, 2011
The guidelines for most lenders is 620 for the middle credit score. However, under special circumstances a manual underwrite can be done. Call me if you want to discuss your options for a VA Home Loan.

Best Regards,

Chuck Chrobak
Sterling Savings Bank - Home Loan Division
Mortgage Banker
Cell: (425) 330-9657
Office: (425) 893-5723
Fax: (425) 491-7176
Apply Online at: http://www.chuckchrobak.com
0 votes
JJ Paz, , Kirkland, WA
Sat May 14, 2011
Good evening Mr. Jackson,

This question is so relevant and timely especially I am currently working with two VA loan buyers looking to buy properties in the Greater Seattle and Eastside area

As a sign of the times, mortgage investors across the country have made it a requirement that a borrower have a 620 FICO score or higher to qualify for a VA loan. Now, this is not a change implemented by the VA Department – this is something that mortgage investors (those who actually purchase note on the secondary market) have now enforced due to the elevated default risk associated for borrowers with sub-620 FICO scores.

Previously, no minimum FICO score requirements existed – as long as the broker/lender received an approval through either Fannie Mae’s or Freddie Mac’s “Automated Underwriting System” (AUS), the Veteran would be approved. Even if the broker/lender did not get an approval through an AUS, there was an option to do a manual underwrite in which a VA approved underwriter could approve a loan based on compensating factors and explanations of previous derogatory credit. The compensating factors would have to validate that the Veteran is worthy of credit approval – and can meet the expected housing obligations. Back in March 2009 and manual underwriting is no longer allowed. The Veteran must get an approval from an AUS in order to qualify for a VA Loan.

If you would like to qualify for a VA loan but fall short of the 620 FICO requirement – there are credit analysis tools that can help forecast your FICO score if certain actions are taken (like paying down debt or removing an incorrect late on a credit card). Feel free to contact me at 425.7531719 to learn more about how to access these tools. It may help provide a blueprint of what you may need to do to qualify in this constantly changing mortgage environment. Thank you for taking time to read. Have a sensational weekend :)
0 votes
Aaron Schrei…, Other Pro, Leavenworth, WA
Sat May 14, 2011
Clyde- VA loans require a little more paperwork from the home inspection. We perform a lot of these inspections and provide the extra paperwork and pest inspection at no additional charge. Good luck with your Kirkland house hunting!
Web Reference:  http://www.amsinspection.com
0 votes
Patrick J He…, , Bellevue, WA
Fri May 13, 2011
Clyde,

We only require a minimum of a 600 middle score to qualify. Please call us a 206-790-7284.
0 votes
Jirius Isaac, Agent, Kenmore, WA
Fri May 13, 2011
Clyde,

I am working on a VA loan for a client right now. They are wonderful loans. The main problem with credit reports for these loans is that they do not like seeing a lot of lates in the last 12 months. Please give me a call at 206-841-9976, or send me an email and I would be happy to help you. It can all be done online, or I am just in Kenmore, right next to you.
Web Reference:  http://www.metromgi.com
0 votes
Dan Tabit, Agent, Issaquah, WA
Fri May 13, 2011
Clyde,
VA is fairly flexible, but does have some limitations. I've attached a link where you can read more specifics and see how you might fit. Ultimately you'll need to sit down with a VA lender and discuss your situation. If your credit issues can be addressed, I'd recommend starting right away. There are some simple things many people can do to raise their credit scores and improve their chance for approval and lower their rates. Best of luck.
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