VA Home Loan

[Anonymous]

**I am a first time home buyer and will be using the VA home loan**

- Income: $52k
- Car loan: $495/mo

- $4k seasoning now

- I'll have about $130 in monthly credit cards if I apply in July
- About $80k in federal student loans (deferred until 10/4/18 so they won't be included in my DTI)
- About $6k in private student loans with monthly payment of $42 (not deferred)

Now the baddies: 

• AES/PHEAA
• February 2016 (30 day): Refused to honor Goodwill Letter
• Badcock: Equifax
• October 2016 (30 day): Honored Goodwill Request
• Credit First (CFNA)
• May/June 2016 (30/60): Sending Goodwill Request
• Barclay
• Baddies are from more than 2 years ago: Refused to honor Goodwill Request
• Victoria’s Secret
• Sept 2015/Jan 2015 (30 day): Rep sent over info and stated my Goodwill Request should be honored
• Farmer’s Furniture
• Feb 2013 (30 day): Sending Goodwill Letter
• Capital One
• May/June 2012 (30/60): Reporting to TransUnion
• Military Star
• Jan 2014 (30), April/May 2014 (30/60), June/July 2014 (30/60), August 2014 (Charge Off): Refused to honor Goodwill Letter
• Capital One
• More than 2 years ago: Honoring GoodWill Letter
• Capital One
• No Date (60 days): Equifax
• Tax Lien
• Paid (May 2014): Equifax

Rough estimate of my DTI with my new mortgage: 

- Back end DTI at 42.28%

- Front end DTI at 27.11%

I am looking to purchase a property no more than $175k with a mortgage of $1100 or less. I have been scrubbing my credit, but this is what remains as far as the baddies. I will be switching jobs (same career field, just relocating to a bigger city). My biggest fear with this homebuying process is getting hung up in underwriting. Is my file too bad to make it through underwriting? I will be using the VA home loan. I have been in contact with a direct lender and a mortgage broker. Who would be the best person to go with?

[Anonymous]

You didn't say what your scores are?  I am in a similar situation.  Here is what I am working with...

Mid-Score - 631 (So in the lowest bracket w/highest interest rate)

Income $47500

Car loan - $596

5k Seasoning (for reserves)

$20 in monthly credit cards(1/3 CCs with balance of $20)

No student loans.

And I have between 6-10 collections/late pays/etc between the 3 CRAs

I was sent through 2nd level process(essentually just the underwriting supervisor) saying it should get approved.  I was sent a pre-approval letter for $180k.  But that does not include any HOA funds or whatnot. 

So If your scores are above a 620 I think it is doable.  My backend was approved at a tad over45%

Hope my lender doesn't see this.. HA.  Kidding.  And if you are looking for an awesome lender, send me a PM and I'll get you in touch with one(PS... He reads and posts to these forums).

[kc0039]

I'm currently doing a VA loan where his total DTI is 53%. The key is residual income and see how much they can qualify for

[Anonymous]

Yes. My residual income would be over the 120%. I'm really just concerned about the 30 day late in Feb of this year and the 60 day Fromm May/June of last year. I will be applying in July so that will leave me with one 30 day late. I've worked extremely hard and just need to close by October 1.

[DallasLoanGuy]

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@Anonymous wrote:
Yes. My residual income would be over the 120%. I'm really just concerned about the 30 day late in Feb of this year and the 60 day Fromm May/June of last year. I will be applying in July so that will leave me with one 30 day late. I've worked extremely hard and just need to close by October 1.

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if you get approved thru automated underwriting....the credit is deemed acceptable. and the 30 day late just needs to be acknowledged with a letter explaining.

[Anonymous]

Even with a refer? If I get referred...

[kc0039]

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@Anonymous wrote:
Even with a refer? If I get referred...

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You got a refer/ineligible or refer/eligible through AUS?

[Anonymous]

Refer eligible

[kc0039]

One of the reasons why that is the case is because of cash to close. FHA/VA will give a Refer/Eligible 90% of the time because of funds to close. Your LO should put in the exact amount of credits or overstate assets to see if you are qualified for the VA loan.

[VALoanMaster]

The AUS will typically tell you why the decision is coming back as a refer. In cases where the borrower is short to close, the system will tell you that they're short to close.

In other cases it will tell you the debt ratio is too high or that it appears there was foreclosure or bankruptcy less than 2 years ago. Some time the system will just say it's referred without an explanation. In these cases, a good LO ( like me) will know the few tricks to try to get the system to issue an approval. If all of that fails, then we know the reason for the refer decision is tied to the credit history.