VA Lending Flashcards
Who is eligible?
Veteran’s entitlement to loan benefits
How much service must a vet fulfill to be eligible?
24 continuous months of active duty
Are Members or Reserves/National Guard eligible?
Yes, after 6 years
Do vet spouses qualify?
Yes; unmarried surviving spouse also qualifies
What documents are required?
Certificate of Eligibility; discharge papers (DD214)
Is there a max loan limit?
No
What is the vet’s entitlement?
Stated on COE; $36000
What if the entitlement is less than $36k or missing?
Either it was changed by law or vet already used entitlement
What loan products are eligible?
Fixed rate with temporary buy-downs; ARM product minimum 3 years with 1/5 caps
Is there mortgage insurance?
No
What does the funding fee do?
Helps defray costs of administering the VA program and to help cover defaulted loans
How much is the funding fee?
Depends on if it has been used before and how much downpayment is. Refer to chart
Are there usually down payments?
No
Who is exempt from funding fee?
Those receiving compensation for service connected disabilities; purple heart recipients on active duty; Vets who receive compensation for disabilities; surviving spouses
What fees can vets pay for?
Reasonable customary amounts for itemized fees and charges; 1% flat fee from lender; reasonable discount points
What % of seller’s concessions?
4% of appraised value
Is the VA strict about credit?
Yes
Does child care count in the DTI?
Yes
Are condos permitted?
Yes, but must be approved by VA
Are PUDs permitted?
Yes and does not need to be submitted for approval
Are there public water and sewage requirements?
Yes, mandatory hook up required by local building, planning, or health authorities
What is the max LTV for VA loans?
100%
In what 2 scenarios are standard reserves required?
6 months PITI for a 3-4 unit prop; 3 months PITI on each rental prop owned by vet but not secured by VA loan
When is military employment income not considered stable?
Within 12 months of release from active duty
What are compensating factors to offset income?
10% down payment; significant cash reserves; clearly strong ties to community coupled with non-military spouse’s high income
How much of rental income counts towards income?
75%
What is the Interest Rate Reduction Refinance Loan?
Refinances existing VA loans to a lower rate. No appraisal, credit info, or u/w required
When can an IRRRL have a cash out?
Reimbursement of energy efficient improvements; computational errors; changes in final payoff figures; upfront fees; refund of escrow balances
What is the max loan amount of IRRRL?
Existing VA loan amount and late payments and charges, fees and charges, cost of energy efficient improvements, va funding fee
What is the max loan term of IRRRL?
Remained of old term plus 10 years, not to exceed 30
