July 17, 2019 by Andersonedward
The Veteran Affairs or more famously known as VA loans are the most sought after home loans in the city of Houston. The VA loans are backed by the VA department and only offered to war veterans, their families, and currently employed military members.
The veterans wishing to own a Texas home after retirement have different mortgage loans which come under conventional loans offered by banks and government backed loans such as Federal Housing Administration (FHA) loans and Veteran Affairs (VA) loans given by approved mortgage lenders. The main reason why veterans want to obtain VA loans is due to low credit score and moderate income, which makes it difficult for them to get the home loans offered by banks. The VA lenders for low credit scores Houston provide equal opportunity to potential veterans and allow them to become homeowners regardless of their financial position.
The VA department knows that many veterans have served abroad due to which they have been unable to maintain a good credit score. The main factor which mortgage lenders ask from homebuyer is credit score as it gives them a clear picture of whether the homebuyer will pay the loan on time or default on loan. The credit scores are categorized by FICO (Fair Isaac Corporation) and range from 300 to 850. The VA lenders for low credit scores Houston offer the VA loans because the loans are guaranteed by the VA department and any financial loss is covered if the veterans default on the loan amount. The veterans wish to obtain the VA loans because not only they get qualified even with a low credit score, but they do not have to pay any down payment or mortgage insurance premium. The interest rates and closing costs of VA loans are also low as compared to loans offered by banks.
The VA department does not have any minimum credit criteria, but there are some VA lenders for low credit scores Houston that provide the VA loans only after the veterans comply with certain compensating factors which are
Ø Having stable employment with the same employer for more than 5 years
Ø Have a high monthly income
Ø Do not have any debt to pay
Ø Have no debt in collections
Ø Maintain a low debt to income ratio; and
Ø Show debt payments for the last 12 months