Va loan program is specifically meant for military veterans so that they can acquire loans that can help them to purchase homes. Though the department of the Veterans Affairs does not offer loans, it provides guarantee to all loans offered by a variety of VA lenders. In other words, this means that all the VA loans have a backup of the federal government. The program is designed to honor the military veterans for their role they have played in safeguarding the security concerns of the country. However, some of the military veterans do not have equal opportunities with other citizens who are gainfully employed with better paying jobs such that they can access loans to buy homes. In order to cushion the veterans from their weak economic status, they can also enjoy the benefits of VA loans that are meant for them.
Minimum credit score for VA loans
The VA loan credit scores for most lenders are quite flexible and some lenders do not enforce a minimum credit score benchmark to determine those people who are eligible to get loans. However, the majority of VA loan lenders consider 620 as the appropriate score for consideration to see if one deserves to get a loan. According to FICO credit scores, the credit score in the range between 620 and 679 is regarded as fair credit and any applicant who falls within such range is eligible to get a VA loan. The most important thing that should be noted by VA loan applicants is that they do not need to look for excellent credit scores in order to access the loans they desire to buy homes. The veterans are given special preference that is backed up by the federal government in guaranteeing the loans that are offered to all those people who qualify. This type of loan is by far different from the other conventional loans offered by different financial institutions as illustrated in detail below.
FICO versus VA credit scores
It can be observed that the FICO credit scores are within the range of 300 – 850 and the national average ranges around the score of 699. Therefore, it can be seen that the minimum credit score & credit card aspectfor VA loans of 620 is quite reasonable given that it falls below the national average score. It can also be noted that other conventional lenders consider a high credit score for loan approval and the scores range from about 660 to 740. These scores are far too high than the VA credit score average level of 620 that is acceptable to many lenders. Compared to other types of loans, the credit score for VA loans is quite accommodative given that it is low and it does not follow stringent requirements like other lenders. All the same, a good credit score is just good for the veterans so that they can easily get VA loans to purchase their dream homes. The lenders still consider the credit score of the applicants for VA loans though they are not very strict about it like other commercial lenders of different loans.