PenFed Mortgage with Confidence


Can I Get a VA Loan With Bad Credit?


Are you considering a VA home loan and worried about your credit? That's more common than you may think. Here are three of the top questions borrowers ask us every day: What is a good credit score for a VA loan? What is a good credit score for a home loan? Can I get a VA loan with bad credit? We'll answer those questions and tell you what to do if your credit isn’t the best. And most importantly, you'll learn what credit score you'll need with PenFed for a VA mortgage.

If you’ve made some credit mistakes over the years or have a shorter credit history, you may not have stellar credit. If at all possible, before you try to buy a home, it’s a good idea to do whatever you can to improve your credit. However, if you’re short on time and have bad credit, it’s essential to know what might be doable.

Here are six steps you can take to improve your credit:

  1. Pay all your bills on time.
  2. Get a free copy of your credit report.
  3. Request the credit bureaus to fix any errors.
  4. Pay off any debts if possible (but don’t close your accounts).
  5. Don’t apply for any credit and don’t buy anything on credit.
  6. Apply as soon as your score is close to 620.

What is a good credit score for a VA loan?

Let’s go over some basics. Credit scores range from 300 to 850. To get a VA loan with PenFed, your score needs to be 620.

There are hundreds of different credit scoring models. The two most popular are:

  1. FICO®: 90% of mortgage lenders use FICO® for their credit reporting.
  2. VantageScore®: Credit Karma uses this and it’s another credit scoring model from Equifax, Experian, and TransUnion.

There are other scoring models for specific industries. For example, TransUnion offers CreditVision for car dealers.

Each credit scoring model has a range. It ranks whether your credit score is very poor, poor, fair, good, very good, or excellent. Here is an example of what a “bad” or poor credit score would be based on a FICO Score:

Score Range


Less than 580

Poor: Well below the average U.S. score, so lenders may see you as a risky borrower.


Fair: Below average compared to other U.S. consumers, some lenders will approve you, though you may need to be near the higher end of this range for approval.


Good: Near or slightly above average and most lenders will approve you with this score.


Very Good: Above average compared to other U.S. consumers; many lenders will see you as a reliable borrower.


Exceptional: Well above the average U.S. consumer's credit score, many lenders will approve you with the best interest rates and terms.

What is a good credit score for a VA loan?

The VA doesn’t have a minimum credit score requirement — but the lenders who offer VA loans do.

You can sometimes get approved for a VA loan with bad credit, yet with many lenders —you will need a credit score of 650 or higher. At PenFed, we only require a score of 620.

If you think your score is close to 620 and you’re looking to buy a home — you should apply right away. The mortgage professionals at PenFed will work with you to get the VA loan preapproval you need so you can start home shopping.

What is a good credit score for a home loan?

And if you’re wondering what a good credit score for a home loan other than a VA —with PenFed, it’s still 620. Although, with a conventional loan, the interest rates won’t be as low as a VA loan. If your score is below 700, your interest rate will be higher.

How to Apply for a VA Home Loan

A VA home loan is one option for different types of mortgages available for service members, veterans, and surviving spouses. You can learn about all of your options by contacting our PenFed team or applying for preapproval.

To learn more about PenFed mortgages or what option is right for you:

PenFed PenFed, Inc FREE - On Google Play