VA DTI Guidelines On Over 60% Debt-To-Income Ratios
This blog will discuss the VA DTI guidelines on over 60% debt-to-income ratios. VA loans are the best loan program in the United States. The Department of Veterans Affairs is in charge of VA loans.
VA loans are the best mortgage loan program in the nation. VA loans has no down payment requirements, no annual mortgage insurance premium, no minimum credit score, no maximum debt-to-income ratio cap, and has better rates than other traditional mortgage loan program.
Only eligible active and retired United States Armed Services members with a valid Certificate of Eligibility (COE) and surviving spouses qualify for VA loans. Per VA DTI guidelines, there is no maximum DTI cap on VA loans as long as borrowers can get an approve/eligible per the automated underwriting system.
Is It Possible to Qualify For VA Loans With Over 60% DTI?
GCA Mortgage Group have approved and closed countless VA loans with borrowers with over 60% debt-to-income ratios or higher.
VA DTI guidelines state that the VA does not require DTI caps. As long as borrowers have a lot of residual income, I have seen automated approvals with DTIs as high as 65%. VA caps are up to the individual mortgage lender. All lenders need to meet minimum VA agency guidelines.
Every lender can implement higher standards. These higher credit/income standards implemented by individual lenders are called lender overlays. This blog will discuss VA DTI guidelines for over 60% debt-to-income ratio borrowers.
VA DTI Guidelines Versus Lender Overlays
VA DTI Guidelines do not particularly state a maximum debt-to-income ratio requirement. It is up to the automated underwriting system to render an automated approval. The AUS will receive automated approval if borrowers have strong residual income and decent credit.
Many lenders will have their lender overlays. What overlays mean is a higher credit/income requirement on top of the minimum guidelines set by the Department of Veterans Affairs. This is why certain lenders may require higher credit scores. Many lenders may require debt-to-income ratios between 41% to 50% on VA loans.
Unfortunately, many borrowers who are told they do not qualify for VA loans due to their DTI are often not told they meet VA guidelines but not with them. This is unfortunate. FHA Bad Credit Lenders is licensed in 48 states and has over 160 wholesale lenders. Most of our government and conventional wholesale lenders have no overlays on VA loans.
Automated Versus Manual Underwriting
VA DTI Guidelines are different on automated versus manual underwriting. VA has no caps on debt-to-income ratios on automated underwriting system (AUS) findings.
There is a maximum debt-to-income ratio cap of 50% DTI on VA manual underwriting guidelines. Mortgage underwriters can exceed the 50% DTI Guidelines with two or more compensating factors.
Borrowers in a Chapter 13 Bankruptcy repayment plan can qualify for VA loans just one year into the plan via manual underwriting. There is no waiting period to qualify for VA loans after a Chapter 13 Bankruptcy discharge date. However, bankruptcies not seasoned for at least two years must be manually underwritten.
Best Mortgage Lenders With No Overlays on VA DTI Guidelines
Homebuyers facing hurdles in qualifying for VA loans due to lender overlays can contact us at FHA Bad Credit Lenders at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com.
FHA Bad Credit Lenders, empowered by NEXA Mortgage LLC, is licensed in 48 states and has wholesale mortgage lenders with no lender overlays on government and conventional loans. We are also mortgage experts on non-QM loans and bank statement loans for self-employed borrowers.
FHA Bad Credit Lenders has a national reputation for being a one-stop mortgage lender. This is because we have wholesale mortgage lending relationships with over 210 wholesale mortgage lenders with thousands of mortgage loan programs for owner-occupant, second homes, and investment properties. FHA Bad Credit Lenders also have lending relationships with commercial lenders and hard money investors. If there are any mortgage loan products in today’s market, you can rest assured FHA Bad Credit Lenders has them on our wholesale lender list. The FHA Bad Credit Lenders team is available seven days a week, evenings, weekends, and holidays.
