VA Loans Harder to Get?

August 10, 2010 by · Leave a Comment 

According to the New York Times, it may be harder for veterans to get loans in today’s lending environment.  V.A. loans have long been an excellent opportunity for vets to buy a home with little or even nothing down, but major lenders like Bank of America, Citigroup and JPMorgan Chase, are now refusing to offer V.A. loans to borrowers with credit scores below 610 or even 600. If your credit score is below that, you’d be well advised to work on getting your score up before trying to qualify for a loan.

The Veterans Administration was on track to insure 300,000 mortgages this fiscal year, which ends Sept. 30, versus 325,000 in 2009.  The V.A. insures 25% of the loan amount on a V.A. loan, available to those who can show 24 months of continuous active duty service and no dishonorable discharge.

Remember, active duty folks, the IRS has stated that eligible taxpayers must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract is entered into by that date, the taxpayer has until June 30, 2011, to close on the purchase.  Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual’s spouse) who serves on qualified official extended duty service outside of the United States* for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010.  Read more about the home buyer tax credit extension for eligible military personnel stationed overseas here.

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