VA Loan Credit Scores and Down Payments: A Reader Question

A reader asks, ?What does my credit have to be to acquire my VA loan? I and my wife both served during wartime. Also how much would I need as a down payment??

VA loans are approved based on many things?your credit score, employment history and other factors all figure in. While credit score is a determining factor, it?s not the only one. That said, credit scores depend on the lender but in general a borrower who comes to the VA mortgage process with a FICO score of 620 or better is in a good place to begin the application. Some lenders may require higher scores?650 or better by some accounts.

Borrowers should know that the lender?s standards play an important factor here. A borrower who meets the bare minimum credit score as determined by the financial institution may be approved for a VA home loan, but might not have access to the best rates or terms.

That is important to keep in mind during the planning stages of the VA loan process. The better your credit, the better your interest rates and terms are likely to be.

This reader question also included a query about down payments. VA loans do not require down payments in most cases unless the asking price and the appraised value do not agree. In such cases the borrower has the option to walk away from the VA loan, or pay the difference between a lower appraised value and a higher asking price.

VA does not guarantee loans for more than the appraised value or the asking price (whichever is lower). That loan amount will include any approved add-ons to the mortgage such as approved fees financed into the loan amount?but the basic loan amount minus those add-ons will be the lower of the two figures.

Yes, technically speaking paying the difference is not a ?down payment? but for the borrower, the end result is the same?paying cash up front on the VA loan.

Do you have questions about VA home loans? Ask us in the comments section.

Join us on Facebook

Google + Bruce Reichstein

?

Source: http://activerain.com/blogsview/3549013/va-loan-credit-scores-and-down-payments-a-reader-question

etta james at last john king obama sings al green heidi klum and seal ohare airport etta james songs east west shrine game