Are you a veteran or service member who is in need of a home loan? If you are eligible, you can apply for a VA home loan and enjoy low-interest rates of up to 2.250%. Even if the mortgage rates vary depending on the condition of the market, you can always be assured that it will always be better as compared to other kinds of loans.
Credit score for a mortgage loan
This may surprise you but the U.S. Department of Veterans Affairs does not demand a specific credit score. The VA may not have requirements, even if they are the ones that insure the loan, but the private companies who will lend you the money will. Usually, credit score requirements for VA loans are between 580-660. But because of the current COVID-19 situations, minimun requirements may have changed, so better talk to our loan officers for an updated information.
Why is a credit score important? It is important because the higher your credit score is, the higher your chances of getting better terms and better rates as well. That being said, it doesn’t mean that if you have a low credit score, it will be impossible for you to get a VA loan. You can still be approved but bear in mind that lenders will look kindly and favorably on those who have excellent credit.
How much mortgage loan can I get?
There are some considerations for you to know how much mortgage loan you can get. A loan officer will help you calculate the maximum amount you can get for your VA loan. Your gross monthly income will be multiplied by .41 as your total debt repayments should not go higher than 41 % of your income. After the officer has calculated that figure, he will then start deducting other debts like car payments and other loans that you are paying on installment. Whatever is left, will be the maximum monthly payment you will need to pay. VA lending guidelines dictate that you can only have a maximum of $2,010 monthly payment including principal, interest, insurance, and taxes.
