Have you already been pre-approved for an FHA or a VA loan but you haven’t found the right Spring Texas home yet? The bad news is that as of November 1st, 2010, you may no longer be pre-approved.
Why?? Because many investors are increasing the minimum credit score requirements on FHA and VA loans from 620 to 640. It was just earlier this year that minimum credit score requirements increased from 600 to 620.
Can the lenders / investors cancel your loan pre-approval? They certainly can and will. A loan pre-approval is just that pre-approval. It is NOT full loan approval.
Before you go spending money on option fees and home inspections, you better give your lender a call and ask them if you meet the new minimum credit score requirements. The last thing you want to do is spend money on a Spring Texas house that you will not be able to secure financing on.
The increase in minimum credit scores for FHA and VA loans is bad news for potential home buyers but is good news if you are a landlord. As some tenants who had ideas of becoming home buyers will have to put those ideas for a while longer until they improve their credit.
The days of the minimum requirement for loan approval was that you could fog up a mirror are long gone. As good credit has become important once again.