VA Loan Eligibility Requirements After Chapter 13 Bankruptcy

This BLOG On VA Loan Eligibility Requirements After Chapter 13 Bankruptcy Was UPDATED On December 4th, 2017

Veteran home buyers who are either in a Chapter 13 Bankruptcy Repayment Plan and/or has recently gotten a Chapter 13 Bankruptcy discharge can now qualify for VA Loans. The Gustan Cho Team at USA Mortgage is a direct lender with no lender overlays on VA Loans.

Under VA Loan Eligibility Requirements After Chapter 13 Bankruptcy here are the VA Guidelines During And After Chapter 13 Bankruptcy:

  • Veteran Borrowers can qualify for VA Loan one year into a Chapter 13 Bankruptcy Repayment Plan
  • There is no waiting period to qualify for VA Loans after discharge of Chapter 13 under VA Loan Eligibility Requirements After Chapter 13 Bankruptcy
  • VA does not have minimum credit score requirements, however, Veteran Borrowers will need an approve/eligible per AUS 
  • Best chances of getting Automated Underwriting System Approval is having at least a 580 credit score
  • There is no caps on debt to income ratio on VA Loans under VA Loan Eligibility Requirements After Chapter 13 Bankruptcy
  • However, Veteran Borrowers with higher debt to income ratio should have residual income, compensating factors, and reserves
  • Under VA Loan Eligibility Requirements After Chapter 13 Bankruptcy, all VA Loans without 2 year seasoning after Chapter 13 Bankruptcy discharge are manual underwriting

The United States Department of Veterans has implemented VA loans for members of the United States Armed Forces, veterans, and their spouses.

  • The purpose for VA loans is to offer its members an affordable mortgage loan program through the VA Loan Guarantee Program
  • The main advantage of VA Loan Programs is that no down payment is required and its members can get 100% financing with no mortgage insurance premium required and no money out of pocket to make home ownership affordable to its members

Mechanics Of VA Loans: VA Loan Guarantee Program

The United States Congress has created the VA Home Loan Guaranty Program more than 70 years ago to take care members of the United States Armed Forces and its Veterans.

  • This program was created as part of the Servicemen’s Readjustment Act of 1944 and its main mission was to take care of our post war veterans
  • Veterans who served in our World Wars did not have credit so the VA Loan Program had lenient credit standards
  • VA Loans are very popular today with over 20 VA Loans closed since 1944

Eligibility Requirements For VA Loan Eligibility Requirements After Chapter 13 Bankruptcy

To qualify for VA Loans, there are eligibility requirements which include income requirements, asset requirements, and credit requirements as well as minimum years of service.

  • Years of service in the military depends on whether the veteran served during wartime or peacetime
  • Veterans who have served during World War II,  Korean War, or Vietnam War, they qualify for VA benefits after 90 days of active duty with a discharge any other than a dishonorable discharge
  • For those veterans who have served in the military during peacetime from 1947 through 1981, to receive VA loan benefits, the veteran needs to prove that a minimum of 181 days of continuous active duty was served and any discharge other than a dishonorable discharge
  • For Veterans who have disabilities resulting from their active duty, disabled, the minimum mandatory 90 days to 181 days requirements are fully waived

VA loan benefits are also extended to members of the following:

  • National Guard as well as Reserves
  • NOAA members ( National Oceanic and Atmospheric Administration), Coast Guard, and public health service members
  • U.S. Coast Guard

Spouses of deceased veterans can be eligible for VA loan benefits.

Advantages Of VA Loans

VA loans require no down payment on home purchase and there is no mortgage insurance premium required.

  • There is a VA loan funding fee but that funding fee can be rolled into the balance of the VA loan
  • VA loans are assumable as long as the home buyer qualifies for a VA loan
  • The assumable aspect can be of major benefits if in the future mortgage rates do not remain at historical lows as it is today
  • It can be a great selling point

The Gustan Cho Team at USA Mortgage are direct lenders on VA Loans and have no lender overlays on all government and conventional loans. Veteran Borrowers who need to get pre-approved on VA Loans with a direct VA mortgage lender with no overlays, please contact us at 262-716-8151 or email us at gcho@usa-mortgage.com. We are available 7 days a week, evenings, weekends, and holidays.

Gustan Cho

www.gustancho.com

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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