http://mil-loans.com - Military Home Loans is a VA loan specialist in San Diego California. As San Diego VA Loans experts, we cater to Veterans in San Diego as well as veterans throughout the state of California. We want to insure that every veteran across America anybody who is eligible for their VA loan can have access to the full scope of what the VA offers them as a home loan benefit.
The big part about VA that people sometimes do not realize is that the VA doesn’t loan money. All they do is guarantee the loan. I use the word they “vouch” for somebody. You can also use the word “insure” the loan, it’s a slightly different definition but similar concept. A bank loans the money. Why is this important? Because the bank wants to get their VA guarantee that says "yes I got my protection" and in order to get that VA guarantee they just need to meet the VA guidelines. what would you call that, about 3 inches thick? This is the VA guidelines, I just happened to print them out and mine have all sorts of tabs and everything all over them. As long as you meet those guidelines, you get a VA guarantee.
Do banks just use these guidelines? No. Because they sit there and go "these guidelines are a minimum, I can always add my own rules" and there are places where you can look at the VA guidelines and say "you know, you're a little liberal there. I want to tighten that up a little bit so I am going to require...a credit score". VA technically has a rule that says that you can do this without a credit score. Poor Credit is not reason alone to deny a file but bad credit is. That's really hard to institutionalize across a giant bank to say "OK, all my underwriters you guys just each one of you figure it out as you go". Sometimes it's easier to say "hey our minimum credit score is..." fill in a number. Some banks will say 620 some banks will say 640 some banks will say 660 and that'll be their minimum. And it will be buried in their guide that looks something like this, maybe it has a blue cover. It'll just be a sentence in that section and if you've worked at that bank as a loan officer for 30 years or even 3 years you know your blue VA guidelines and it says no, our credit score is 660 I'm sorry mam, I can't do your loan.
What happens when that client you meet at an open house who seems so eager to go buy a house goes and gets pre-approved because you say "are you pre-approved?". They go and take care of that Monday morning. They go to their typical bank and their bank says "you're denied for a VA loan because you have a 650 credit score". What does that client then do? They go become renter because they think a VA loan is a VA loan is a VA loan. This is ridiculous. Stinking government program". It's not the government program it's each lender adding their own rules. This is why it gets confusing because sometimes don't know where their lenders start and where the VA rules have left off. So that's why bank A and bank B are different.
