Va loans Low credit score?

Question

I am eligible for a VA home loan. Is it possible to get approved with a credit score of 585. I have past credit issues but the past year and a half I have made all my payments on time.

Answer 1

Yes, 585 is "doable."

Answer 2

Go and research VA loans online. Or call a local loan officer and ask. The VA DOES have guidelines and bottom lines.
A one time client of mine was trying for a VA loan, but he came under heavy questions because his score was 600 or something. He had to write what's called a letter of explanation as to why he had the stuff on his credit that he did.
In the end, he wasn't approved.
And it doesn't matter if you are paying things on time now. There are still bad judgements and negative past things lingering on your report that aren't going anywhere, you being good now is just not making your credit worse than it is. Take care of those outstanding problems and build from there.

Answer 3

I don' t know where you get the idea that 620 is "average" let alone "wonderful." It's sub-prime and borders on poor. A FICO score below 620 cuts you out of the mortgage market entirely. Those risky loans that contributed to the economic melt-down are a thing of the past. Anything below 725 or so is going to result in higher interest rates and/or larger down payment requirements for a conventional mortgage. You can go as low as 620 on an FHA or VA loan but you still must meet very strict housing cost to income and total debt to income ratios and have enough income to swing the payments. I've been turned down in the past for missing one of those ratios by less than half a percentage point. I know what it's like being in the potty credit wise with a FICO in the mid 500 range and debt up the wazoo. It takes time to dig out. The only thing that you can repair quickly is getting erroneous derogatory information removed. Legitimate derogatory information stays for 7 to 10 years and nothing but time will lessen the impact. The older that derogatory information is, the less impact it will have. It took me 10 years to go from 550 with $50,000 in credit card debt to 750 and no debt. That was 20 years ago and I've kept it between 750 and 800 since then and have kept total unsecured debt to less than 5% of my gross annual income and total debt service (including mortgage) to less than 25% of my gross income.

Answer 4

If you need advice on home loans with bad credit. Go to http://www.mortgageawareness.com for free consumer information on this subject.