VA Loan Credit Requirements With No Credit History

How Can Veterans Meet VA Loan Credit Requirements With No Credit History?

Marcus Marion, CMA™ 5 months ago 0 23

VA loans are a popular mortgage option for U.S. veterans or military members who need to own a home in the country. These loans are government-backed, although borrowers can access them through private lenders. The VA loan program was started in 1944 and has since benefited more than 25 million veterans

Like conventional loans, VA loans have unique requirements for eligibility, and a great credit score is one of them. However, you may still get the loan if you have no credit history. Keep reading to know how a veteran can meet the loan credit requirements with no credit history.  

What is a VA Loan?

VA Loan For Home

A VA loan is a government-backed loan given to military members, veterans, and their surviving spouses. Interested borrowers usually access these loans through credit unions, banks, and private lenders, provided they meet the requirements. 

VA loans require zero down payments, and this is one substantial benefit of owning land or a home using it. The application process is easy, and the requirements are relatively lower than those of conventional loans. 

VA loan credit requirements vary among lenders, but most require a FICO credit score of 580 and above.

Who Qualifies for a VA Loan?

VA Loan Credit Requirements

If you are eligible for a VA loan, you will undergo the normal loan application process, which involves filing the paperwork. However, you may not pay the down payment or the mortgage insurance because the government backs the lending. 

Here are the primary qualifications for getting a VA loan; 

  • Be an active military member, having served at least 90 days during war or 181 days during peacetime. 
  • Be a U.S. veteran 
  • Be a spouse to a U.S. veteran

Before applying for the loan, you should get the Certificate Of Eligibility online. Lenders use this certificate to find out if you are eligible and qualified for the loan. 

The Lowest Credit Score for VA Loans 

According to FICO, a credit score is considered fair if it ranges between 580 and 669. So, anything below 580 is low or poor.  

When applying for a VA loan, many lenders must check your credit score to know how well you have settled your debts. If your VA loan credit score is less than 580, the lender may hesitate to give you the loan unless you prove capable of repaying it through other means. 

If you plan to apply for a VA business loan, check your credit score or talk to your lender to know their minimum VA loan credit score requirements. 

What Happens When You Have a Low Credit Score? 

If your score is less than 580, you may wonder if you should continue with the VA loan application or stop it. Discussing the issue with your lender is advisable because lenders deal with the problem differently. While others may deny you the loan, others may consider other factors to know if you are worth getting the loan, even if it’s a lower amount. 

So, what can make you qualify for a loan with a low credit score? Your credit score performance for the last two years is one of them. The lender will check your VA loan credit score and see your performance over the previous two years. You may get a loan if the score is below 580, but it has improved over the last two years. 

The lender may also check your financial statement to know your income and net worth. You may qualify for the loan if your income is significant enough to cover the loan or if you have a high net worth. 

Other factors that the lender may consider include your military benefits, assets, and loan repayment discipline in the last 12 months.

How to Apply For A VA Loan for Land with No Credit History

VA Loan Application

Many lenders use the VA loan credit requirements calculator to check the borrower’s eligibility. However, getting a VA loan for land without a credit history is still possible. Here are some helpful tips to help you navigate the process if you don’t have a credit history. 

1. Have an Honest Explanation 

Your lender will need to know why you do not have a credit history as an active military, veteran, or surviving veteran spouse. Be ready with an honest explanation for consideration. 

2. Get a Guarantor 

A guarantor or co-signer may be an added advantage if you don’t have a credit history. However, your cosigner should have an excellent credit score for the lender to consider your option. 

3. Avoid Many Applications 

Many applications can cause you to have a negative credit score. If you don’t have any score, stick to one application and repeat after a while if the first application is denied.  

How to Improve Your Credit Score to Get a VA Loan

VA Loan Income Requirements

A credit score isn’t the only requirement for getting a VA business loan. Some lenders consider the VA loan income requirements by assessing your debt-to-income ratio. However, you may need to monitor and improve it to increase your chances of getting the loan. Here are some of them. 

1. Check for Mistakes 

Credit scores are prone to mistakes, and yours may have some errors. Analyze your report to confirm that there’s no misleading information and that all information is captured. You may spot huge mistakes that have been lowering your score. 

2. Limit Requests 

Whenever you need a loan, your lender checks your credit history and makes a hard request. Too many hard requests could negatively affect your score, as they create an impression that you may have a financial problem, hence the many requests. Limit the times you apply for loans to improve your credit history. 

3. Consolidate or Refinance Debts

Perhaps many debts are the reasons your credit history is poor. In that case, you may refinance or consolidate them into one or two debts with a favorable interest rate. An experienced financial officer can examine your debts and guide debt consolidation. 


A VA loan is a great mortgage option if you need to buy a property or acquire land for building your home. Only veterans and people willing to join the military qualify for the loans, and the requirements are not hefty. If you are a veteran looking forward to getting a VA loan, improve your credit score to qualify for a more significant amount. Nevertheless, find a suitable lender to help you understand your options in getting the loan. 

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