Purchase and IRRL Transactions Refinance Transactions by jolinmilioncherie


									                                                  VA Matrix & Underwriting Guidelines

VA                  •   Fixed-Rate
Guidelines          •   15- or 30-year term
                    •   Fully Amortizing

                                              Purchase and IRRL Transactions
                                                   Maximum LTV              100%

                                                   Refinance Transactions

                                                   Maximum LTV               90%

                All VA loans need to be compliant with the VA guidelines. The information provided is not intended
                to be a comprehensive set of VA underwriting guidelines; such information can be found in the VA
                pamphlet 26-7 Guaranty of Insurance of Loans to Veterans – GI Programs, available at
                http://www.va.gov The highlights of the product guidelines are listed below:

                All transactions- except Interest Rate Reduction Refinance Loans (IRRRL) refinance transactions-
                must be submitted to AUS receive an Approved/ Eligible rating to be eligible.

                All appraisals, including VA appraisals, are obtained in a HVCC complaint manner where the
Appraisal       borrower/realtor/loan officer/originator/broker does not select the appraiser nor contacts the
                appraiser during the appraisal process.

                All VA loans, except IRRRLs, require a VA appraisal completed by a VA Fee panel appraiser.

                For all IRRRLs a minimum of a 2055 exterior is required and must be obtained in a HVCC compliant

Condominiums    All condominiums must be on the VA approved list.

Credit          All VA loans must be submitted to either LP or DU and must receive an Accept/Approve/ Eligible

                If there is any derogatory or contradictory information that LP or DU were unable to consider, then
                the underwriter is required to downgrade the decision to a Refer and manually underwrite the loan.

                If the loan is an IRRRL a minimum of six months payment history on the current mortgage is
                required. If the mortgage is less than six months old the loan must be documented and
                underwritten as accredit qualifying VA IRRRL.
                                                      VA Matrix & Underwriting Guidelines

Credit             Credit documentation must be dated within 120 days of the date of the note.

Debt Ratios        For Loan Amounts < = $417,000 maximum DTI 41% or allowed by AUS with a maximum of 50%.

                   For Loan Amounts > $417,000 maximum DTI is 41%.

Delinquent         If the borrower is presently delinquent on any Federal or State debt, (ex. Student loan), the
Federal or State   borrower is not eligible until the delinquent account is brought current, paid or a satisfactory
Debts              repayment plan has been made between the borrower and the agency and is verifying in writing.
                   All Federal and State Tax Liens must be paid in full prior to approving the subject mortgage loans.

Eligible           For VA home loan purposes, a veteran is a person who has served or is currently serving on active
Borrowers          duty in the United States Military or Coast Guard and who was discharged or released from active
                   duty under conditions other than dishonorable. Un-remarried surviving spouses of an eligible
                   service member who died as a result of service or service-connect injuries may also be eligible.

                   Veteran must have Certificate of Eligibility (COE) and it must have sufficient entitlement to meet the
                   minimum 25% guarantee.

Eligible           1-4 single family homes
Property Types     Single Family detached homes
                   Condominiums – per VA guidelines

Eligible           Homes listed for sale: Any home listed for sale at the time of application is not eligible for purchase.
                   For rate and term refinance transactions the subject property cannot be listed at the time of
                   application. If it was recently listed, a copy of the cancelled listing agreement is required.

                   For Cash Out Refinance transactions the listing agreement must be canceled six months prior to the
                   loan application date or the loan is subject to a maximum loan to value of 70%

                   Parcels exceeding 10 acres may be considered if typical for the area and value/marketability is
                   supported in the appraisal with comparable with similar acreage. Acreage must be residential in

                   The home must be fee simple.

                                                     VA Matrix & Underwriting Guidelines

Eligible          Alabama, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Kansas,
States            Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Missouri, Ohio, Pennsylvania,
                  New Jersey, New York, North Carolina, Tennessee, Texas, Virginia, Washington and
                  Wisconsin are being accepted.
Transactions      Purchase
                  Rate and Term Refinance
                  Cash Out Refinance

Funds to Close    The borrower must have sufficient cash to cover:

                  Any closing costs or points that are the borrower’s responsibility and are not financed in the loan
                  and the difference between the sales price and the loan amount if the sales price exceeds the
                  reasonable value established by VA.

Hazard            The amount of hazard insurance coverage must be equal to at least the principal balance of the new
Insurance         loan or replacement costs.

Income            A 4506T must be signed at both the time of application and at the time of closing.

                  A verbal verification of employment will be conducted on all transactions prior to closing.

Investment        Not allowed.

IRRRL – General   A minimum of a 2055 exterior is required and must be obtained in a HVCC compliant manner.
                  The mortgage being paid off must be current and the payment history must reflect no 30 day or
                  greater mortgage lates in the last 12 months.

                  A minimum of six months’ payment history on the current mortgage is required. If the mortgage is
                  less than six months old, the loan must be documented and underwritten as a credit-qualifying VA

                  Texas 50 (a) 6 loans are not allowed

                  Credit report must still be obtained and the borrower(s) must meet the minimum credit score
                  requirements to be eligible.

                  The maximum term allowed is the lesser of 30 years or the unexpired term of the loan plus 10 years.

Maintenance &     The borrower will be qualified with monthly maintenance and utility costs of $0.14 per square foot.
Utility Costs

Maximum Loan      The maximum base loan amount is the lower of $417,000 or county loan limits established by VA.
                                                   VA Matrix & Underwriting Guidelines

Maximum         The maximum number of financed properties that the borrower(s) can have is 4. However, the
Financed        borrower must still have remaining VA eligibility for a VA loan.

Maximum LTV     100% For Purchase transactions
                90% for Refinance Transactions
                100% for interest Rate Reduction Loans (IRRL)

Minimum         For Loan Amount < = $417,000 minimum FICO Score required is 640.
Credit Score    For Loan Amounts > $417,000 minimum FICO score required is 700.

Minimum Loan    There is no minimum loan amount

Occupancy       Primary Residences only

Refinance       Subject property must have an existing lien, properties that are owned free and clear are not
Transactions    eligible.

                No Texas 50 (a) 6 loans allowed.

Reserve         If the loan amount is $417,000or less, and the borrower is not qualified with rental income there are
Requirements    no requirements for cash reserves. If the borrower uses rental income to qualify or the loan
                amount is greater than $417,000 six months of reserves must be documented

Secondary       Not allowed.

Third-Party     Additionally, a maximum of 4% of the value of the property as indicated on the Notice of Value may
Contributions   be contributed from an interested party (property seller) to be applied towards closing costs and /or
                prepaid items.

                Any property seller concession or combination of concessions which exceed 4% of the established
                reasonable value of the property is considered excessive and unacceptable for VA guaranteed loans.
                A reduction of the sales price in the amount equal to the excess is required in these instances.

MISC – Non-     For non-purchasing spouses in CA and WI, a credit report for the non-purchasing spouse is required.
Purchasing      The spouse’s authorization to obtain credit must be provided. If the non-borrowing spouse refuses
Spouse in       to provide authorization to obtain credit information, the loan will be denied. All joint credit must
Community       be considered in the debt ratios; however any debt that is the sole responsibility of the non-
States          borrowing spouse will not be included. The credit score of the non-borrowing spouse will not be
                used for qualification.


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