Va no approval

[Brownsugar0415]

Me and my husband applied for a va loan in november. His mid score was 640 mine was a 620. It was found that he has an Alaska Student loan that has gone into collections. The credit report stated he was 2500  behind with owning 10000. Our mortgage broker validated the debt since we knew nothing of it as he has been in school full time for the last 6 years. The debt was validated at 14,000 with 10000 being due.  Needless to say  we could not get approved  for the loan.  My question is what should we do to make it go away , we really need to buy in the next 3 months.  We can get proof of enrollment during the time Alaska student loan states it defaulted.  We are also prepared to pay 10,000 over the next 3 months but not at one time today. But in M arch we can . This is his only baddy on his report. As for my report I have the same issue with Alaska student loan but they are stating 30,000 but cannot validate the debt. Any suggestions would help

[StartingOver10]

You have to fix the student loan issue before anyone will give you a mortgage guaranteed or insured by the federal government at all. The VA loan is a government guaranteed loan and with the student loan defaults (I assume these are federal loans) the VA is not going to guarantee your mortgage with a current student loan default.

Even if the default was years ago, until it is fixed, you aren't getting a mortgage unless it is a high down payment, private type mortgage not insured or guaranteed by the government. You can see why this would be an issue.

The good news is this: once its fixed you will be eligible for a mortgage as long as you qualify and from your post, it looks like there is only this one issue to clear up for each of you.

[Brownsugar0415]

thank you for the feed back. It's not a federal  government  student loan, it's a state ran private loan.  I don't know if that makes a difference. I was going to see if I paid a large sum up front and setup payments if they would delete the late and show paying on time. But it is a collection, not sure if that will help or do a PDF in March when I have the full amount.

[StartingOver10]

You might actually be better off rehabbing the student loans rather than paying off in a lump sum. I say this because if you can rehab, the late pays are wiped off completely after 9 months of ontime payment IIRC. That puts you in a far better position mortgage wise.

Go to the student loan section on this site to get details.

[cartwrna]

Rehabbing the loan would not fit into your timeline, but is the best option. I just rehabbed a student loan that I took out in 07', had 4 collection accounts on report due to it. After 9 months (may have been 10) I completed the program. All negative collections were deleted and the loan was reassigned to Sallie Mae. Now shows as a positive tradeline since original open date (2007).I have not been late since needless to say That is most likely only option for removal. Only other option is to satisfy the loan in full prior to being able to receive a mortgage loan.