There is good news for those veterans who have bad/low credit scores, and that is that it can be improved! You can take a number of steps to improve your credit score, thus setting a more reliable foundation for future decisions and plans. Especially when it comes to getting approved for a VA loan.
First of all, make sure you aren’t late on any payments. Specifically your mortgage payment or rent, because if you are, it will surely affect your credit score. Be sure to pay off all liens, judgments, and collections that you may owe.
Another thing that will help immensely is to pay down credit card debt along with any other debt you may have. By closing one or two credit cards, it gives you less probable debt open to you. If you are trying to buy a house or get a VA loan, steer clear from closing or opening accounts needlessly. (Opening one could affect your score negatively at first due to taking out more credit….As for closing one, you are ridding yourself from getting the credit from that account, so that could possibly be bad as well for someone who is trying to improve their credit right off.) On the other hand, opening an account for other reasons, such as building your credit history, can be very helpful. In fact, it’s the KEY to building your credit. (Especially helpful after bankruptcy.)
One more strategy to improving your credit score is to confront the credit reporting agencies in writing to make sure everything is resolved that may be mistaken/flawed. You can also send them your bankruptcy discharge papers to be sure they don’t have inaccurate reports (which are not uncommon for them to make mistakes). This will speed the process as they update your report.
If you have a low credit history, it is a good idea to start building it for at least a year before trying to do a VA loan. Learn how to use a credit card wisely. You shouldn’t go over 50% of the offered limit and pay off the balance each month.
As you can see, there are a number of ways to improve your credit history. Whether it’s paying off credit cards, learning how to use one better, getting yourself out of debt, opening an account to build credit, or paying your bills and mortgage on time, each plays an important factor to getting and keeping good credit. It’s a habit-forming process that takes a lifetime of upkeep!