2016 VA Guidelines On Co-Borrowers Explained
What Are 2016 VA Guidelines On Co-Borrowers?
Income is one of the most important factors when qualifying for VA Loans. VA Loans have specific mortgage lending guidelines when it comes to co-borrowers and are different than any other mortgage loan programs with regards to co-borrowers. VA Loans is the best mortgage loan program available for home buyers because you do not have to put any money down on a home purchase. You can purchase a home with no money out of pocket with a VA Loan as long as you can get a sellers concession by the home seller to cover the closing costs or in the event if you cannot get a sellers concession, you can get a lenders credit by the mortgage lender for your closing costs. Mortgage rates on VA Loans are the lowest than any other mortgage loan program. Mortgage interest rates on VA Loans are lower than mortgage rates on FHA Loans, USDA Loans, and Conventional Loans. There is no mortgage insurance premium on VA Loans even though the home buyer does not put any money down and the mortgage loan is 100% financing. The Department of Veteran Affairs is the governmental entity that sets standards and VA Lending Guidelines on VA Loans and insures VA Loans. The Department of Veteran Affairs does not originate nor fund VA Loans. The Department of Veteran Affairs insures VA Loans to banks and mortgage lenders who are approved VA mortgage lenders as long as the loans they originate and fund adhere to VA mortgage lending guidelines. Unfortunately, not all home buyers can qualify for VA Loans. Only Veterans of the United States Armed Forces with a VA Certificate of Eligibility can qualify for a VA Loan. Veterans with a VA Certificate of Eligibility can enjoy the great benefit of buying a home with a VA Loan with no money down and no closing costs with extremely low mortgage rates. VA Loans have very lenient VA mortgage lending guidelines, however, VA Guidelines On Co-Borrowers are pretty strict.
VA Guidelines On Co-Borrowers: VA Guidelines On Co-Borrowers Versus Other Mortgage Programs
Every mortgage loan program have their own mortgage lending guidelines with regards to co-borrowers. With FHA Loans, FHA mortgage loan borrowers can have co-borrowers who are related to the main borrower. The relationship for co-borrowers to the borrower needs to be as follows: The co-borrower needs to be related to the FHA main mortgage loan borrower by marriage, law, or blood. So in order for someone to be eligible to become a co-borrower on a FHA Loan, co-borrowers need to be a spouse, son, daughter, brother, sister, mother, father, grandmother, grandfather, step-son, step-daughter, step-brother, step-sister, step-mother, step-father, step-grandmother, step.-grandfather. However, the enforcement of the actual relationship depends on each particular mortgage lender. There are many mortgage lenders like myself that will not check and will just take the borrower’s word on the relationship of the co-borrower to the main borrower on a FHA Loan.
Fannie Mae does not allow co-borrowers on Conventional Loans. However, Freddie Mac does permit co-borrowers on Conventional Loans and the co-borrower does not have to be related by blood, marriage, or law like FHA Loans.
2016 VA Guidelines On Co-Borrowers
The Department Of Veteran Affairs does allow a co-borrower to be added on a VA Loan, however, the co-borrower needs to be the spouse of the Veteran. Unfortunately, if you are a fiance of the Veteran or a live in boyfriend and/or live in girlfriend of the Veteran, you cannot qualify to be a co-borrower on a VA Loan. There are many cases where a Veteran has a live in girlfriend and/or live in boyfriend who have been living together for many years and may have children together, however, if they are not legally married, they do not qualify to be a co-borrower on a VA Loan.
I recently had a call from a Veteran with a VA Certificate Of Eligibility who was living with an ex-spouse. They have divorced many years ago but reconciled and were living together. They also had kids together and were interest in purchasing a home. Unfortunately, the Veteran needed the ex-spouse to be added as a co-borrower in order to qualify for the VA Loan. Although they are a couple and have reconciled after their divorced and are living together, the ex-spouse cannot be added on as a co-borrower unless they got married again. We can proceed and process and underwrite the VA Loan, however, the marriage will be a condition in them closing on their VA Loan. They decided to get re-married in order to qualify for the VA Loan. Case scenarios like these often happen where couples get divorced and reconcile and get remarried again. On this case scenario, them remarrying made the VA Loan happen and these folks will close on their VA Loan.
If you are a Veteran and would like to qualify for a VA Loan, please contact me at 262-716-8151 or email me at firstname.lastname@example.org. I am available 7 days a week, evenings, weekends, and holidays to take your phone call or answer your emails on any questions you may have in qualifying for a VA Loan.