Question about AU..doing a VA loan after VA SS.

[Sigma1914]

I had a short sale over two years ago and because of it I have to go through manual underwriting. My loan officer put it through and it was approved referred (whatever that means) so he said it has to go through manual underwriting. However, I guess the bank has my credit report coded as a foreclosure even though they have sent me in writing stating it was a shortsale and I have the hud1, settlement docs showing it is a short sale, so this has been a mess to clear up. My question is why does my loan officer keep telling me hes trying to get it approved through the automated system when its suppose to be manualy undewritten? I'm scheduled to close in 2 weeks.

[ShanetheMortgageMan]

Your loan officer is probably trying to make it so you have an easier approval/less approval conditions to satisfy.  With the closing 2 weeks from now it should've already been reviewed by an underwriter.  Have you made it to that step yet?

If not, then since you had a short sale on a VA loan did your loan officer check to see if you have enough remaining entitlement for the amount of VA loan you are trying to qualify for now?

[Sigma1914]

Thanks for the info. He never submitted it to the UW I'm just finding out he didn't submitt it because he says that my DTI is at 47% and it needs to be at 41% before they can do a manual underwrite which is why you was trying to get it approved through AU. I have had it with this loan officer. He has wasted a month of my time and now I'm down to the wire and must try and find someone else who can do it. The loan officer told me to consider amending my taxes to remove the business expenses, inwhich I can do that, but then I may owe the IRS. So don't know how that will work out.

[ShanetheMortgageMan]

While VA doesn't have any debt ratio requirements, most lenders stick to the 41% when manually underwriting.  I am aware of a couple lenders going to 45-50% but that is definitely not the norm and it's very tough to get debt ratios that high approved unless there are some big compensating factors (like a lot of reserves, excellent credit).

Yeah amending your taxes to remove the business expenses will look very fishy to an underwriter, plus on the amended tax return you have to explain to the IRS why you are amending it - and to say in order to qualify for a mortgage?

Is there any debt you can pay off to reduce your DTI?

[Sigma1914]

Thanks for the infomation. I was able to pay down some cards to get my DTI to 43% and it got approved in manual underwriting today. Now I just need to get my VA Appraisal transfered from one lender to my current lender, hopefully that doesn't take too long.

I was going to get the taxes amended to remove the business expenses because I don't have a business. They should have been submitted as donations to the nonprofit. Its my fault for not checking my returns and just waiting on my refund to appear in my account.

Scheduled to close on Sept.17...crossing my fingers.

[ShanetheMortgageMan]

VA appraisals don't need to be transferred, but a VA case # does.  VA appraisals stick to the property and are for "any eligible Veteran".  Good luck on your closing.