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I am currently deployed to Iraq(USMC) and last time I was here this board assisted me a lot in cleaning up my last few discrepancies in my credit report so I am coming back for some guidance/advice. I am looking to buying a Condo when I get back(about a month left) and applied for a home loan(VA) through NFCU for 155,000 but am unsure what to expect. I have a TU: 722 & Eq: 697 just pulled on 12/25)I hear that NFCU uses Equifax so I am bummed since that is the lower score. As far as my debts:
Truck payment: 425.00 monthly(owe 3,400)(pay 525.00 monthly)
Personal Loan: 225.00 monthly(owe 1,800)
Visa: I pay sporadically online and always more than minimum due Owe 6,250(10,000CL)
LOC: owe 1,250(5,000 CL) I pay sporadically online also and plan on it being paid off in a month or so
Sore Credit Card: owe 3,600(8,250 CL) again, I pay sporadically online and always more than minimum due
Mastercard: owe 1,500(3,300CL) I pay sporadically online and always more than minimum due
My assets include:
10,000 in Roth IRA
14,000 in TSP
6,000 in Savings Bonds
3,394 base pay
I also get housing allowance of 1,500 monthly and since I moved out of my apartment before deploying I am using this to pay down my debt and pad my TSP and Roth IRA accounts.
I guess what I am looking for is how likely am I to get approved for my VA loan and do you think I will get a good interest rate(when I did my online application it stated 5.125% with 0.250% points). I am just nervous because I am a first time buyer and this is a big "chunk of change".
As always, your assistance is greatly appreciated!
Semper Fi
Read Chapter 4(underwriting) of the VA loan manual. You will learn a butt load.As long as you meet the residual income standards and have decent dti then there will be no problem. My dti(two mortagages on two houses) and my car payment is around 55% but my residual income is at $1800 which is way above the minimum of 600ish. Residual income is gross payment minus taxes, monthly payments(including the new mortgage) and i think the sum of .14 cents times square footage of the property. Tax free income can be grossed up to meet minimum DTI set by the bank. My special duty pay,jump pay,demolition pay,BAH and BAS was all grossed up.
Also whether your score is 640 or 750 interest rates will be the same across the board so I would not worry about interest rates at different score levelss. I would try to lower your CC debt or payoff your pax loan as much as possible so that all when you present your package they do not have to add in all of your minimum payment which will raise your DTI...
Im not an expert but I am about to close on my 3rd home(and hopefully last) using VA