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Still can't get a VA loan after we both have 620+ scores

We are looking to get a VA loan.  We had a foreclosure in 2007 and bankruptcy in 2005.  Our credit score was pulled yesterday by a lender.  Mine is 650 and my wife's is 636.  We were approved with credit score, but the computerized underwriter is declining us.  What gives?  It is quite frustrating to be above the magical 620 score only to have another hurdle in front of us.  Any suggestions?
  • June 19 2013 - Weston
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Answers (8)

Looks it's simple. Once you have file BK, have a foreclosure or a short sale there are MOP codes encrypted into your tradelines that the AUS (automated underwriting system) pickups and can give you a Refer. when all other indicators should approve it. Some of these are completely erroneous but unless your challenge them then that's how they stay. Having said that, my company does manual underwriting FHA, VA and USDA. For FHA and VA I need a 620 middle credit score. USDA I need a 640. Period! If you tired of getting jerked around, click on my Profile and I will give you the road map.

Best of Luck!
  • June 19 2013
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The Computerized Underwriter is probably what we lenders call an Automated Underwriting System (AUS). Even if your loan officer said that your score matched their guidelines, it doesn't mean that the scenario will "fly" when using the almighty AUS. There is something going on with your credit in general if you still have a score of barely over 620 six years after a foreclosure. There must have some other credit problems after that event that are standing in your way. And, no, 620 is far from a magical score.
  • June 19 2013
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Other factors besides credit score go into the computer approval (AUS).
Do you have a down payment?  3.5% for FHA did your lender try it?  After a BK and a foreclosure proving you can save, solid debt ratios, job times, and probably last 2 years of a perfect credit will probably be needed.   
  • June 25 2013
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wells fargo will do a 620 va loan
  • July 15 2013
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If you are not receiving an approval through the automated system, your file could be underwritten as a manual underwrite.  As long as you meet the other criteria as established in the VA Handbook, you should be able to find a lender that can assist. 
  • July 16 2013
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You should try a lender that does VA manual underwriting. Here we do manual VA underwriting. Contact me via my profile.

GL!
  • July 16 2013
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  • June 04 2014
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Hi there, 

Just because DU or LP do not approve the loan upfront does not mean that the lender cannot do what's called a "manual" underwrite. We actually do these all the time for Veterans. The trick is just finding one that understands the process. 

My name is Jimmy Vercellino and I am a mortgage banker specializing in VA Loans. Please fee free to reach out to me if I can answer any additional questions as it relates to the VA Home Loan process. 

Semper Fidelis, 
Jimmy Vercellino 
  • August 06 2014
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