Part of the VA loans in Arizona guide, where every rule on this page is cited and dated.
A veteran gets declined, is told their score is too low for a VA loan, and concludes the benefit is not available to them.
The VA did not decline them. A lender did, using a number the VA never published.
What the VA actually requires
The VA's own approach is about the whole credit picture, not a threshold score. Recent payment history, whether past problems are resolved, and whether the borrower has re-established themselves all matter more than a single number.
What lenders require
A number. Theirs. And it varies more on VA than on almost any other program, precisely because there is no published floor to anchor everybody to the same place.
Three things that follow:
Every lender has one. A lender saying they have no minimum has not told you theirs.
They are far apart. The spread between the most conservative bank and the most accommodating investor on a VA file is wide. That spread is your opportunity.
They are not published. You have to ask, and most veterans have never heard the word overlay.
The question that sorts it
"Is that the VA's requirement, or your overlay?"
The honest answer is always "ours," because the VA does not publish one. A lender who tells you the VA requires a specific score is either mistaken or not being straight with you, and either way you have learned something.
If the obstacle is an overlay, you may be approvable somewhere else today with nothing about your file changing. That is not a loophole. It is how a market with many investors works, and it is the strongest argument there is for using a broker on a credit-sensitive VA file.
See Declined by One Lender, Approved by Another.
Where residual income rescues VA files
This is the part that makes VA genuinely different and that most originators cannot explain.
VA tests what is actually left in your pocket each month after the mortgage, the debts, estimated taxes, utilities and maintenance, against a requirement scaled to your family size and your region.
A veteran whose ratio looks tight can pass comfortably on residual income. A borrower who would be declined on a conventional debt-to-income test can be approved here. It is a genuinely different test and it exists because the program was designed around what a household actually needs to live on.
See Residual Income Explained.
What to do if your credit is the obstacle
Credit work done before a file is structured changes which programs are available. The same work after an offer is accepted changes nothing, because reporting cycles do not fit inside a thirty day escrow.
- Pay down revolving balances. Fastest legitimate lever, and it recalculates when balances report.
- Dispute genuinely inaccurate items through the bureaus. Weeks, sometimes two rounds.
- Do not close old accounts, which raises utilization and shortens average account age.
- Do not open anything new.
- Ask before paying old collections, because it does not automatically help.
- Budget sixty to ninety days.
See Fix the Credit First.
The thing I want you to take away
Nobody is entitled to a loan, and some files genuinely do not work yet. But the sentence "you do not qualify for a VA loan because of your credit score" is, as a statement about the VA, not true.
It is a statement about one lender. Find out which, and then decide whether to fix your file or change who is looking at it.
Why bring a VA file to us
- We quote the rule and the overlay separately. VA sets the floor. Your lender sets what they will actually do. Those are different numbers and only one of them decides your file.
- Broker model. When a lender's overlay is the obstacle rather than VA's rule, the fix is moving the file, not fixing you.
- We do not treat the VA loan as the fallback. No down payment, no monthly mortgage insurance and an assumable note is the strongest financing available to most buyers who have earned it.
- You talk to the principal. Ricky Khamis is President of EPiQ Lending, NMLS #173141, lending in Arizona since 1999 and a 2025 Presidents Club Winner at CMG Home Loans. Direct line: (480) 999-9842.
EPiQ Lending is NMLS #1936984, at 7975 N. Hayden Road, Suite A-101 in Scottsdale. Verify all of it before you trust any of it: Ricky's EPiQ Lending profile, the Scottsdale branch, and the license itself at NMLS Consumer Access. Hold every lender to that standard, including us.
Send me your Certificate of Eligibility, or let me pull it, and I will tell you what your entitlement actually supports.
Equal Housing Opportunity. This is general information, not a commitment to lend or an offer to extend credit. The VA home loan program is administered by the U.S. Department of Veterans Affairs; loans are made by private lenders, not by the VA, and this site is not endorsed by or affiliated with the VA or any government agency. Eligibility, entitlement, funding fee amounts and exemptions are determined by the VA based on your service record and disability status. Program requirements are set out in the VA Lenders Handbook and change over time, and individual lenders routinely impose requirements stricter than the VA's published minimums. Any figures shown are illustrative, are not a quote, and are not a projection of investment returns. Rental income, property appreciation and refinancing availability are not guaranteed. Rates, terms and program guidelines change and depend on credit approval, property appraisal and other qualifying factors. Not all applicants will qualify. This is not legal, tax or investment advice.
Looking at a specific home? Send me the address and I will run the numbers: rickykhamis.com/analyze
