-
Va Loan with 500 credit score
Va loan with a 500 credit score, any way that has ever been done. Lady was married spouse passed and then she got cancer. Which she is cancer free now. So they have foreclosed on the home she is living in that was her husbands. She was not on loan. She is an RN, I know VA is not so much credit score. This below picture of info came from a Realtor friend. We would love to be able to help get some way, if possible purchase the home that foreclosed. She is still living in it still. She is an heir to property, so I was unsure how it would affect. As her name is on deed but not mortgage.
-
7 Replies
-
Ronda
Go over this case scenario with Christian Sorenson of EPM
-
I think Dan Saviangno of Carrington Mortgage can probably do this.
-
Mortgage Solution Financial are very forgiving for veterans who have extenuating circumstances. Contact the rep at Mortgage Solution Financial.
-
Ronda, please connect with Ronda Butts who is a dually licensed realtor and loan officer at GCA. I think you two will make a great fit. Ronda’s Email address is ronda@gustancho.com
-
If the spouse was the primary income earner and the unfortunate cancer situation meant they could not pay the bills, then it may be possible to get an exception.
-
I think you can get an exception on FHA but do you think you can get an exception on VA loan if the wife is not a veteran?
-
Having a 500 credit score while dealing with a VA loan is tough. The existing circumstances regarding your friend mean there’s some leeway for exploring possibilities. Here are key points to keep in mind:
A Veteran’s Basic Advantage Loan Eligibility
FICO Score Requirement: According to the VA’s standards, there is no minimum requirement, but it is advised that most lenders take a score of around 620. However, lenders will not always deny working with borrowers with low scores if there are difficult situations.
Repayment Ability: For people with low scores, there are factors that one can consider, such as having an RN job, a low DTI, or even providing a large sum during the payment phase.
Preventing Foreclosure and the Claiming of the Deed
Occupancy: Her heir status could work in her favor since she is an heir and lives in the house waiting for an ancestor to die. This allows her to make a strong case for purchasing the house as if she plans to occupy it, the lenders might be more inclined to help her.
Legal Owner of the Deed: The property is rightfully hers if her name is on the deed. This claim could come in handy when negotiating the purchase of the home.
Choices for Funding
Search for a Veteran-Friendly Lender: Some lenders specialize in handling VA loans and veteran applicants with low credit risks. They may be more flexible in terms of their underwriting criteria.
Get a Co-Signer: A co-signer with a better credit history than you are better positioned to increase the chances of the loan being sanctioned.
Other Sources of Financing: If the VA loan appears impossible, other financing options, like FHA loans, might be more acceptable to credit standards.
How to Handle the Foreclosure
Approach the Lender Before Auction: If the house has yet to be sold at auction and is still in foreclosure, the loan should be negotiated with the lender to sell the house to the buyer.
Contact a Lawyer: Since she is an heir, after contacting a real estate lawyer, he/she may inform her about her position regarding the house and what her rights may be.
Strategies for Improving Credit
Work on Credit Repair: Informing her that to get a loan sanctioned, her credit score should be improved by paying existing debts, paying bills on time, and avoiding errors on the credit report, which would help improve her status before applying for a loan.
Locating the appropriate lender and strategy may be possible. At the same time, there is a consensus that getting approved for a VA loan with a 500 credit score is an uphill task. An heir can look into many options to own the property, including flexible lending options. It will also be important to contact mortgage professionals and legal advisors to succeed with this aim.