The #1 thing that keeps many active military and veterans from using their VA home loan benefits to take advantage of buying a home in California at current rock bottom prices are issues with their VA loan credit. Having credit issues is the #1 issue holding them back from buying a home. So this post with discuss some of the major factors with VA loan credit scores.
Below I will discuss the key important issues in maintaining a good VA loan credit score. But even if you think you have bad credit, give us a call or email because we specialize in assisting borrowers with credit issues and help get them on the track to improving their credit so they can qualify for a VA loan in California.
VA loan credit fundamentals:
- Keep credit card balances at 30% or less than credit limits - the VA loan credit scoring algorithms like to see this. The fastest and most common way to improve you VA loan credit score quickly is to pay balances down to 30%.
- Never be late on anything that reports to your credit - this may seem obvious but it’s not. Auto loans, credit cards, student loans, mortgages report payment history to your credit. Rent, cell phone bills, insurance bills, utility bills do NOT report payment history to your credit. So pay the aforementioned first and never miss a payment. Late payments is the #1 item that drags down a VA loan credit score
- Collections and judgments - if you have collections and judgments on your VA loan credit report, do not pay them off until you speak to us. Paying these off actually LOWERS your VA loan credit score. The VA lender may only require you pay off large collections and will make you pay off all judgments, but wait until right before closing on your VA home loan to do this.
We have a tool we use called Rapid Rescore to assist VA borrowers to quickly raise their credit scores to where it needs to be to get a VA home loan in California. This tool is very effective. What we will do is review your VA loan credit score with you and figure out if there are items we can fix and then use Rapid Rescore to quickly report these items to all the credit bureaus and get an update on your score in 2-5 days.
So give us a call at 858-922-7899 or email at homeloan8@gmail.com if you have any questions about getting approved for a VA home loan in California.
Below are some of the very latest updates on California VA home loans:
- VA loan limits go up to $1 million in many areas in California such as the San Jose area and San Francisco areas. Los Angeles and Orange County have VA loan limits of $697,000. San Diego has a VA loan limit of $537,750. Many buyers with VA home loan benefits are finding it preferable to get a 100% VA loan with no monthly mortgage insurance vs. jumbo conventional loans that require big down payments, high mortgage insurance and super strict guidelines. You can also go above the VA loan limits with a small amount down.
- VA financing is still 100% financing, zero down. There is no other mortgage loan out there today with zero down.
- VA home loans do NOT have monthly mortgage insurance (FHA and conventional loans do).
- VA loan credit scores do not have to be perfect
Regards,
Rob Chomentowski
Sr. Loan Officer (and VA loan specialist)
858-922-7899
homeloan8@gmail.com
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