Using a VA loan to finance a home purchase is a great way for qualified veterans and military servicemembers to get affordable, low-interest financing on a house. However, before you can get that loan, you need to find reputable VA lenders in Colorado Springs. This means submitting applications for loans with different lenders and, no matter which lender you work with, you can always expect them to perform a hard credit inquiry before giving you an answer.
They’ll Check in the Beginning
Most lenders perform credit checks shortly after receiving your application and starting the review process. This is how they determine how risky it is to lend you money. Typically, lower credit scores imply that individuals are less financially responsible and are more likely to default on the loan. However, VA lenders in Colorado Springs put less stock in your credit score when deciding to issue you a loan. A low score won’t automatically disqualify you for the loan. It just means you might not get the lowest possible interest rate on your home loan.
What This Means for Your Credit Score
Every hard credit check, like those performed by VA lenders in Colorado Springs, will impact your personal credit score. Typically, borrowers will see their scores drop from 1 to 5 points depending on their financial situation and their other credit factors. Though your score will drop slightly, it shouldn’t be enough to keep you from getting financing.
You’ll Want to Get Quotes Quickly
Luckily, the credit bureaus put a pause on your score’s changes due to hard inquires for a set window of time after your first mortgage loan application. This means you’re able to apply for financing with different VA lenders in Colorado Springs to make sure you’re getting the best rates possible without hurting your credit score more. The more quotes you can get, the easier it will be to find the best loan for your new home.
Get Advice Now
If you’re worried about your credit score keeping you from qualifying for a VA loan, take a deep breath. Even if you apply and your score drops, you can always build it back up by staying on top of your monthly bills and paying down outstanding debt. The important thing to remember is to take your time and find VA lenders in Colorado Springs that you can trust. Get started by filling out our online application today.