What Is a Good Credit Score for VA Loan?

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  • You may qualify for a zero-down-payment mortgage through Veterans Affairs. Find out more about the minimum credit score for VA loans and what other factors may affect eligibility.

The minimum credit score for a VA loan varies based on the lender you select for your mortgage. The Department of Veterans Affairs has not established specific credit score requirements for this type of home loan, an available benefit for eligible service members, veterans and spouses.

What Is a VA Loan?

VA loans are mortgages backed by the Department of Veterans Affairs. The VA doesn't provide the loans but insures them so lenders participating in the program, including banks, are more likely to approve the loans even if someone doesn't meet the credit or down payment requirements for a conventional loan. VA loans are typically available for qualifying veterans, service members and some spouses or dependents of those individuals. 

What Kind of Credit Score Do I Need for a VA Loan?

Although the VA does not require a minimum credit score for a mortgage, you need to go through a lender that provides VA home loans. Most lenders require a credit score of at least 620, but you may qualify for a lower interest rate if you have a higher score. For example, getting your score over 720 could save you a lot of money on your mortgage interest. 

How Can I Improve My Credit Score for a VA Loan?

Start by checking your score and report to see where you stand. You can get a free copy of your credit report from all three credit bureaus once a year as well as anytime you get denied for a loan.  File a dispute if you notice any errors that could be negatively affecting your score. 

While it can take time to build up a healthy credit score, you can get on the right path by paying all your bills in full and on time every month. You should also avoid carrying a balance on your credit cards of more than 30%. If your credit card has a $1,000 limit, you should pay it down to $300 or less every month to maintain a healthy credit utilization ratio.

What Is the Debt-to-Income Ratio for a VA Loan?

While the VA does not have a minimum credit score, it does have a maximum debt to income ratio. Under the agency's rules, your total debt payments must equal less than 41% of your monthly income before taxes. For example, if your household earns $5,000 in monthly income, total debts must not exceed $2,050.

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