Kim, Home Buyer in Maryland

VA Loan with low FICO score

Asked by Kim, Maryland Wed Mar 4, 2009

My husband is retiring from the US Army after 24 years and we plan to settle in the Indianapolis. Althoughwe will be using our VA loan, will we have a good chance at getting a good rate with not so good FICO Scores of 590 / 619?

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Tony Grech, Mortgage Broker Or Lender, Southfield, MI
Thu Mar 5, 2009
Good question Kim.

With government loans (FHA/VA) it is not so much the scores that matter but the "why" behind the scores. If you have had a lot of recent delinquencies or non-medical collection accounts or a foreclosure or bankruptcy in the last few years then you will probably need to provide a really good explanation and show strength in other areas of qualifying, such as a higher down payment and/or lower debt-to-income ratios. Then it is in the hands of an underwriter to determine if you are a good risk.

If your scores are just low because of some mis-steps in the past and you have kept your nose relatively clean the last 12-24 months then you shouldn't have much trouble.

Either way, like the others said, speak to a local, reputable lender who offers the VA program and go through the approval process with them

Best of luck!
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Luke Allison, , Asheville, NC
Thu Mar 5, 2009

You should be fine. I can qualify you with a score as low as 550. With your lower score, you may have an additional fee in points but your rate will still be between 5.5% and 6.0% - no more.

As long as your debt to income rations stay within VA limits, you should be fine to get approved. I would be more than happy to assist you if you have any questions.

Luke Allison
Flagstar Bank

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Angela Dant, Agent, Fishers, IN
Thu Mar 5, 2009
A good mortgage lender would be able to help you with that question. I have someone that is outstanding that I would love to refer you to. Feel free to e-mail me with any questions.
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Joe Shoemaker, Agent, Indianapolis, IN
Wed Mar 4, 2009

Great question. The best advice I can offer is for you to talk with a mortgage lender whom you trust. If you don't have a lender in the Indianapolis area, I'm glad to refer you to someone with whom I have had great success.

Best to you in all things.

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