VA Loans With Lower Credit Scores And Bad Credit

VA Loans With Lower Credit Scores And Bad Credit

Qualifying for VA loans with lower credit scores and bad credit in a competitive housing market when homes are selling over the list price can be challenging but doable with an iron-clad pre-approval by reputable experienced VA lenders with no lender overlays on VA loans. The housing market has been bullish with skyrocketing home prices. Mortgage companies tightened their VA credit score requirements after the coronavirus outbreak hit the nation in February 2020. Most lenders increased the minimum credit scores on VA loans to 660 FICO. The Veterans Administration (VA) does not have a minimum credit score requirement on VA loans. The coronavirus has not deterred the strong housing market.
See If You Qualify: Contact us click here!!!

Most VA Lenders Increased Credit Standards Due To The Coronavirus Outbreak

GCA Mortgage dba Loan Consultants is a mortgage company licensed in multiple states with no lender overlays. We are one of the very few lenders who stuck to our no lender overlays business model throughout the coronavirus crisis. The team at Loan Consultants was still originating and closing VA loans with credit scores down to 500 FICO during the entire COVID-19 crisis. Most VA lenders with lender overlays increased their credit score requirements even higher to an average of 660 FICO when the coronavirus outbreak hit the United States in February 2020.

VA Loan Requirements After Covid-19 Recovery

In this article, we will give a brief update on qualifying VA loans with lower credit scores and bad credit during the recovery of the COVID-19 coronavirus outbreak in the mortgage industry. We will also discuss how to qualify for VA loans with lower credit scores and bad credit during the bullish competitive housing market. We will cover and discuss the instructions on how to apply for VA loans with lower credit scores at Loan Consultants.
In this article, we will discuss and cover getting approved for VA Loans with lower credit scores and bad credit during the recovery of the coronavirus pandemic and booming housing market.

VA Loans With Lower Credit Scores During Coronavirus Pandemic

A few updates in the mortgage industry surrounding the COVID-19 coronavirus recovery. The coronavirus outbreak is not over. Actually, it is not the pandemic itself but politicians are using it as a political tool. It seems the worst is over but not quite. President Biden and his administration are pushing for vaccine mandates. There are countless court cases with regards to the vaccine mandates being constitutional or power-mongering by the Biden Administration. There is a lot of controversy with the coronavirus vaccine. It does not seem to be working. Vaccinated people are getting the virus. Talks of additional rounds of boosters due to variants of the virus are turning many heads.

Most Lenders Increased VA Credit Score Requirements Due To The Coronavirus Outbreak

Most of the over 26 million Americans who filed unemployment since the outbreak, most of them are back to work. The unemployment rate surpassed the 20% mark at the peak of the coronavirus pandemic. The housing and mortgage markets never closed during the coronavirus outbreak.

 Capacity Overflow During Coronavirus Pandemic Has Now Stabilized

The mortgage process did take longer than normal. Buyers, sellers, lenders, realtors, title companies, appraisal management companies, attorneys, and other third-party mortgage professionals made adjustments due to the pandemic. Teamwork was key and they were troopers where they made it work for both buyers and sellers to get to the closing table. Verifications of employment have become a major hurdle in regard to qualifying for a mortgage. Having millions of Americans off work did not help mortgage qualifications. There are now more strict documentation requirements surrounding employment.

VA Loan Requirements On Documents Required

There are documents required to qualify for VA mortgages. Make sure the docs submitted are complete and have no missing pages.
The following documents are required including:

  • You must send the most recent pay stubs which include year-to-date figures
  • The pay periods must match all documentation provided in the file
  • The loan may not be fun without your most recent pay stub, you must send the paystub CLOSEST to your closing date for funding

A verbal verification must be completed within 24 hours of your closing date. This used to be a 10-day window that is now down to 24 hours.

Changes In The VA Mortgage Process Due To The COVID-19 Outbreak

Small changes like these seem to pop up every few days during these times. As the entire world is adjusting to deal with the pandemic and the recovery period, so is the mortgage industry. We hope this is over soon and underwriting requirements are not changed. We encourage you to follow our blogs to stay updated on the ever-changing mortgage industry. There seems to have been some stabilization in the secondary market already this week. This may help slow the changes throughout the industry. A stabilization of mortgage-backed securities is key.

Lenders Changed Guidelines On VA Loans With Lower Credit Scores During Pandemic

During the COVID-19 coronavirus outbreak, from the start through the recovery process which is now, numerous lenders and investors have raised their minimum credit score requirements to qualify for a mortgage. This is especially true with FHA and VA manual underwriting. We have seen multiple lenders raise their VA credit score requirements all the way to 660, and many lenders raise their credit score requirements to 640. VA mortgage lending does not have a minimum credit score requirement per HUD guidelines. The U.S. Department of Housing and Urban Development or HUD oversees guidelines written for FHA and VA mortgages. They have NOT changed their credit score requirements (as of 4/29/2020), but many lending institutions have. The good news is, Loan Consultants has not raised their credit score requirements and still can fund VA mortgages loans with any credit score restrictions.

The Importance Of Knowing The Difference Between The VA Guidelines Versus Lender Overlays

Besides credit score requirements, many lenders have also raised their debt to income restrictions. Many lenders will no longer allow a debt-to-income ratio of about 45%. On a VA loan, technically there is not a maximum debt to income requirement per HUD guidelines. Our investors do cap debt to income thresholds at a 65% debt to income ratio. This number is still valid even with the added restrictions by most lenders.

VA Credit Score Requirements

Applying for a VA loan with Loan Consultants is very simple. You will first want to gather the following documentation:

  • Last 60 Days Bank Statements – to source money for escrows
  • Last 30 Days Pay Stubs
  • Last Two Years W2’S
  • Last Two Years Tax Returns
  • Driver’s License
  • Certificate of Eligibility

Once you have your documentation ready to go, please call Mike Gracz on 630-659-7644. You and Mike will discuss your mortgage qualifications and any hurdles that might be getting in the way. After this initial one on one VA mortgage consultation, Mike will pair you with a licensed loan officer in your state. From there, you will be emailed an application link to start the pre-approval process. Once that application link is filled out (for all parties on the loan), your loan officer can legally verify your credit report.

VA Loans Qualification And Pre-Approval Process

After the credit report is obtained, your loan officer will calculate your income and tell you exactly what you qualify for. If for some reason you do not qualify under VA guidelines today, your loan officer will come up with a customized financial plan to have you qualify as soon as possible. We work with our clients for as long as it takes so they can buy their dream home. We encourage you to check out our reviews, we have worked with numerous families for well over a year before they qualify for the home that’s perfect for themselves and their families.

VA Manual Versus Automated Underwriting System

VA mortgage lending can be incredibly confusing. Mainly because most lenders have their own set of lender overlays when it comes to VA mortgage lending. One bank may tell you that you don’t qualify, but that may not be accurate. The majority of lenders do not participate in VA manual underwriting. Capital Lending  Network, Inc. is able to manually underwrite VA mortgage loans. This allows us to qualify more borrowers than most lending institutions.

VA Lenders For Bad Credit With 500 FICO Borrowers

We encourage you to call us today with any VA mortgage questions you may have. You can reach Mike Gracz directly on 630-659-7644. Even before the pandemic, about 75% of our clients were turned down by their current lender or are not getting the communication they deserve through the mortgage process. Our loan officers are highly skilled when it comes to VA mortgage guidelines. We look forward to hearing from you and appreciate the service all of our nation’s veterans have given so we can enjoy our freedom!

2017 VA Loan With Low Credit Scores: Introduction to VA Loans

If you aren’t familiar with VA loans or a 2017 VA Loan With Low Credit Scores, you should know that Veterans of the United States Armed Services get some of the best and lenient guidelines available to any borrowers to make sure these people can get the home they deserve for dedicating service to our country.  As long as the borrower/veteran has an honorable discharge and a valid COE or Certificate of Eligibility of their service, they are eligible for a VA Loan.  As I mentioned earlier, VA Loans have some of the best benefits around and they are as follows:
–          Ability to receive the loan with no money down which means that these loans can be had with 100% financing.
–          In addition to the 100% financing, you can also have the opportunity to roll the funding fee into the VA Loan for a true loan with no money out of pocket.
–          Seller’s Concessions are limited to 4% and these funds can be used for closing costs and can further ensure that a loan is had without any money out of pocket.
–          If borrowers run into a situation where the seller of a potential home will not offer a seller’s concession, then there is the ability to cover closing costs via Lender Credit which may result in a higher interest rate, but the credit received should cover all existing closing costs to keep your loan with $0 out of pocket.

2017 VA Loan With Low Credit Scores: Is It Possible?
2017 VA Loan With Low Credit Scores: Is It Possible?

The rest of this article will focus on a 2017 VA Loan With Low Credit Scores and how even low credit scores won’t prevent you from obtaining a VA Loan.  You don’t need good credit to qualify for a VA loan, but can also have fair credit as well.  To see just how you can get a 2017 VA Loan With Low Credit Scores, please see the guidelines below:
–          VA Loans qualify individuals with 580 FICO Credit Scores
–          Must be a Veteran with a valid Certificate of Eligibility
–          Property Types include: Single Family Home, Townhome, Condo, and 1-4 unit properties
–          Must have documented incomes
–          Must have reasonable debt to income ratio
–          Must meet all standard VA Guidelines

2022 VA Loan With Low Credit Scores: Credit Requirements

Just because you are a Veteran with an honorable discharge and a Certificate of Eligibility doesn’t necessarily mean you are guaranteed a loan no matter your history.  Per the VA Loan Guidelines, there are still guidelines and waiting periods that need to be adhered to.  Only doing so will get you the approve/eligible from the AUS or Automated Underwriting System.
–          Even though there is no minimum FICO score requirement for a VA Loan, most lenders will require at least a 580 FICO in order to do a VA Loan.
–          2 year waiting period after recorded date of foreclosure and deed in lieu of foreclosure
–          2 year waiting period after a Chapter 7 Bankruptcy
–          2 year waiting period after a short sale
–          There isn’t a debt to income ratio requirement but you can find lenders go as high as 60% DTI and still get your loan done
–          Collections and charge-off accounts do NOT need to be paid off
–          As long as student loans have been in deferment for more than 12 months, they are exempt from debt to income calculations

2022 VA Loan With Low Credit Scores: Conclusion

As you can see it is definitely possible to get a 2017 VA Loan With Low Credit Scores.  The fact of the matter is if you are an eligible veteran, getting a loan should be easy if you can qualify for a VA Loan.  If you are a veteran, we would love to help you out and you can get into contact with us by calling 888-900-1020, emailing at, or inquiring at

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