Everyone needs to do some developments here and there even when they already have everything in place. If you own a property, it is not a good idea to just leave it rotting.
It needs money to renovate. Sometimes it may feel as though you are building for the first time when in fact, you built long ago. This means, renovations are costly yet they are necessary.
If therefore you need to redo part or whole of your property but you luck the funds, it is time to consider VA renovation loans. These are loans that help property owners to restore the glory of their properties.
There are a few requirements though for you to quality. Though the requirements are more flexible than those of conventional loans, the application will still need to be genuine.
The following are the requirements in general. In essence, they determine the qualification.
Let’s look at each one of them
1. Personal need
This is the first requirement to qualify though many may ignore it. You must first show the need for the loan.
2. Credit score requirements
For the conventional loans, the borrower must be able to meet a certain level of credit score. This is to say that you must show that you are capable of trust.
For the VA loans, you do not have to worry about the credit score. The VA does not set a minimum credit score to qualify for the loan. What happens is that the lender reviews the entire loan profile before making a decision.
Now, this does not mean that you don’t have to worry about your credit score. Of course, it matters because it shows that you have self-discipline.
Not also that each lender does have their FICO score requirements.
Apart from this, the VA does not even specify a maximum debt-to-income ratio.
3. Lender requirements
Each lender may have their requirements in addition to the set ones. Sometimes they may range from the number of credit accounts you have to how you have been paying other loans previously.
Some lenders may require a high credit score and others who may not mind. Simply find out what your lender expects.
4. Down payment requirements
In normal circumstances – and this happens mostly- you don’t have to make any down payments. It is your choice whether or not you want to put some money down. That will be to your advantage since the VA funding fee will be reduced.
Now if the appraisal value is lower than the purchase value, which is a whole new story. You may need to make the least portion of what you are applying for.
5. Property requirements
VA has very stringent property rules. It should not be a surprise though since most lending institutions will have such rules.
It is just about the safety of the building, living conditions and compliance with building codes.
As you can see, qualifying for the VA loans is just to say you must meet the set requirements. They are not that hard to observe. Basically, you just have to keep a clean record.