3 Strategic Steps That You Can Make to Get a VA Home Loan with Bad Credit

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VA home loan programs help active-duty personnel, military veterans, and surviving spouses to get a home loan with a zero down payment, lower interest rates, and no private mortgage interest. Compared to the costs of conventional loans, these loans can result in significant savings for veterans.

However, as to get a VA loan, you have to apply to a mortgage lender, it will be difficult for you to get the home loan if your credit score is bad. Are you wondering what to do? How to fulfill your dream? Well, not to worry. With bad credit ratings, it would be difficult for you to get a VA loan, but not impossible. All that you have to do is to make up your lack of qualifications to get a VA Home Loan Bad Credit. There are some steps that you can follow to make up your credit rating and get the loan. These include:

  • Long-term employment

Long-term employment is one of the fundamental things that a lender gives value while approving VA loans of the home buyers, who have a low credit score. If you have been with the same employer for a long period of time, then it is a good sign for you. Long-term employment shows a stable income, and a stable income means that you are competent to pay back the loan. 24 months of consistent employment is considered as proof of a stable income. But in situations where you don’t have two years of stable employment, your future income will be evaluated and used instead. However, it depends on the lender. So, it is better to talk about this to your lender in case you don’t have 24 months of stable employment.

  • Minimum debt

If you have a huge debt that is due for a long period, along with a bad credit score, then you will be disqualified for the loan. You should have no outstanding credit with untimely or unstable payments in the past twelve months when you apply for a VA home loan. So, if you are planning to buy a home and apply for a home loan with bad credit, then you should clear all your debts at least one year ago. It will create a good impression about you on the mind of the lender, and help to quicken the process of getting the home loan.

  • Huge down payment

Another thing that you can do to get a VA loan with bad credit is to pay a huge down payment. Putting down a large sum of money as your down payment offers lenders more security when lending to you. Moreover, it makes them more likely to lend you the VA loan. If it is difficult for you to afford a huge down payment, then ask for gift money from your family members, friends, and relatives, and make the payment. Later, return the money to them.

Getting a VA loan with bad credit will not be a reason for concern for you if you have a stable income, cleared most of your debts, and are ready to pay a huge down payment. If you have any further queries, ask the mortgage lender and work accordingly.

Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.