VA Home Loan 101: Things to Know before Applying
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What are the necessary things to know about a VA home loan for bad credit in Houston? Let’s go over the tips!
Not so long ago, the Department of Veterans Affairs published that the program had guaranteed 21 million home loan products. Over the decades, there has been a sudden boom. With time, the number is only growing and this is great for VA borrowers.
But how do you get a VA home loan bad credit in Houston? For unlocking the numerous benefits, you need to keep a few things in mind.
How do you apply for VA loans?
As you know, the VA loan programs are not self-issued. You must apply through a mortgage lender or bank. Remember, every lender does not offer VA programs, but some of them only specialize in the particular type of loan. However, it is not mandatory to work with a VA specialist. As long as you find a lender who is experienced, there is nothing to worry about. Moreover, you should work with a lender who streamlines the VA application process. Also, there is no need for paying a high closing cost when working with a VA mortgage specialist.
Since you will be preparing to apply for a VA loan, you should keep the closing costs in mind. For the VA programs, you can expect 4% of the purchase price for the closing costs. Sometimes, the closing costs can be rolled into the loan. Also, you will pay extra for closing costs because of the VA funding fee.
How do you get a VA loan with poor credit?
VA loans were introduced for catering to military borrowers with special needs. The phase of returning to civilian life proves to be difficult for many. As a result, bad credit scores are not uncommon among them. Keeping this in mind, VA borrowers ensure flexible guidelines. The first thing that comes up is that the Department of Veterans Affairs has no rigid credit score requirement. Lenders set the guidelines – you may be expected to prove a credit score of 550.
Besides, the VA lenders allow borrowers who filed Chapter 7 bankruptcy or Chapter 13 bankruptcy. In this case, military borrowers need to wait for 2 years and 12 months so that they can easily qualify. You can also apply for a mortgage with no credit history. In this context, the borrower’s insurance, utility and rent bills, and other payments are considered.
To figure out the type of VA home loan bad credit suits your financial condition, contact Clear Lending.