VA loan denied with a 780 credit score?

[1LNurse]

If your lender was good and interested in helping you get the loan..He/She would have told you exactly why you were denied and scenarios on how to improve. Take your report to another lender for analysis.

[andycloses]

If you want something sooner rather than later, consider an FHA loan even though it will result in a higher payment because of the MIP (and there is a 3.5% down payment required). Some lenders allow your dti to go as high as 56.9% with that program. You can use the FHA loan as a (dare I say) band-aid loan and look to refinance later when your dti is more in line with VA guidelines. Which means you may consider and FHA 5/1 ARM which would be set in the 3% area for the first 5 years you have the loan.

Or consider a higher than market fixed rate to get the lender to pay for part/all of your closing costs. After all, you will be refinancing the mortgage within a few years.

If you still need that co-borrower, he/she may be used if they will reside in the property with you or if they are a relative of yours (someone related by blood, marriage or law).

Good luck and go get 'em.

[Elcid89]

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@Sunshine85 wrote:

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@Elcid89 wrote:

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@Trish wrote:

Ok, since it appears that the credit score plays less of a role in things with the VA. Do you think adding someone onto the loan with a low dti ratio, but a low 620 credit score would allow them to qualify for the 180k? 

2nd income would be 30k. No cc debt no car debt. Student loan payments 68/mo and bk 3 years ago.

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VA will only underwrite at 100% for two party mortgages where the parties are married or both parties are veterans.

Otherwise, you'll run into a situation where VA only partially guarantees, and you get hit with PMI.

For mortgages over $144,000, the maximum guarantee is the lesser of 25% of the mortgage amount or 25% of the Freddie Mac conforming loan limit (which changes yearly).

For a $200,000 mortgage where one party is a veteran and the other is not (nor a spouse), VA's guarantee amount gets cut in half - i.e. the lesser of 25% of half of the mortgage amount or 25% of half of the Freddie Mac conforming loan limit.

In that situation, the lender is going to mandate PMI, so you will probably find that your net payment would actually increase for the same mortgage on the same property. Doubtful that it would help you.

Honestly, you need to focus on paying down debt before you go for a mortgage. You simply owe too much, IMO.

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Actually, that's not true. The OP only has $9k in debt on a $50k salary. The $1100/month in child support is what's impacting their DTI.

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That $1,100 per month is still a monthly obligation. It gets factored into DTI, which was my point. The ratios are just way too high.