VA Loans For First Time Veteran Home Buyers With No Overlays

VA Loans For First Time Veteran Home Buyers With No Overlays

Gustan Cho Associates are mortgage brokers licensed in 48 states

In this blog, we will discuss and cover VA loans for first-time home buyers with no lender overlays. The United States Department of Veteran Affairs (VA) has very lenient mortgage guidelines on VA Loans For First Time Veteran Home Buyers. Getting able to qualify for VA loans for first-time veteran home buyers is a privilege given to our fine men and women of our U.S. Military.

Who Can Qualify For VA Loans?

Only veterans with a valid Certificate of Eligibility (COE) are eligible to qualify for VA loans. VA Home Loans is hands down the best residential mortgage loan program in the United States. A young soldier who has served this Great Country called America can get the most on VA Loans For First Time Home Buyers after proudly serving our country.

Buying Your First Home With VA Loans For First Time Veteran Home Buyers

Purchasing the first home is an exciting time in everyone’s life. A home purchase is the American Dream. It is bragging rights that the homeowner has proven themselves and has succeeded in life. Becoming a homeowner is setting a foundation for providing for one’s family home. Owning a home is where families develop memories. Families are developed and lifelong friendships are made. Provides stability for families for many years and decades to come. Purchasing a home is most people’s biggest lifetime investment. The mortgage process may seem intimidating for most home buyers. There are so many horror stories out on how stressful the mortgage process is. In this article, we will discuss and cover VA Loans For First Time Veteran Homebuyers With No Overlays.

The Key To Closing All Pre-Approvals On Time

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The licensed and support personnel Team at Gustan Cho Associates has no stress during the mortgage process. Mainly because at Gustan Cho Associates, we close on all of our pre-approvals. How? All of our pre-approvals are fully vetted, AUS approved, or meet manual underwriting guidelines. All of our pre-approvals at Gustan Cho Associates are equivalent to full loan commitments to lend. This is how we close 100% on all of our pre-approvals. Gustan Cho Associates does not just close all of our loans, but close 100% of our mortgage loans on time. Gustan Cho Associates is a mortgage company licensed in multiple states with no lender overlays on government and conventional loans. Over 30% of our mortgages originated and closed are VA loans for first-time veteran home buyers.

Qualifying For VA Loans For First Time Veteran Home Buyers

Once a first-time veteran home buyer has set their mind and goals to become a homeowner, the first step to take is to consult with a loan officer to get qualified. One thing to remember is that not all VA Lenders have the same VA Mortgage Guidelines. Most VA lenders have overlays. When qualifying for VA loans for first-time veteran home buyers, make sure to know the basic VA guidelines.

VA Agency Guidelines Versus Lender Overlays From Lenders

Just because a lender says a home buyer does not qualify for a VA loan does not mean that they do not meet VA guidelines. Buyers may not qualify with one VA lender but may qualify with another lender with no lender overlays. Over 75% of our borrowers are folks who either got denied by a lender or are stressing out during their VA loan process because the lender they went with has lender overlays on VA loans.

What Are VA Lender Overlays

What Are VA Lender Overlays

What are VA Lender Overlays?

They are additional VA Guidelines that are above and behind those of the Department Of Veteran Affairs. For example, Gustan Cho Associates does not have a minimum credit score requirement nor does it have a maximum debt to income ratio cap. However, most VA lenders will require a 620 credit score and debt to income ratios not greater than 45%. This requirement by the particular lender is not VA Guidelines but rather lender overlays. One of our loan officers at Gustan Cho Associates recently closed a VA loan with a 589 credit score and 60% DTI borrower in Texas Most lenders would not have qualified this type of borrower. However, this borrower got an approve/eligible per Automated Underwriting System so we were not just able to close him but close him on time with no stress during the mortgage process. Veterans with bad credit and/or lower credit scores should consult with a VA lender with no overlays. Gustan Cho Associates has zero overlays on VA loans

How Much House Can I Afford?

There are two issues veterans who are buying a home need to carefully consider.

  • How much house can I qualify for?
  • How much house can I afford?

Just because a home buyer qualifies for a $300,000 VA Loan does not mean they are able to afford $300,000 worth of housing payments. Mortgage Underwriters do not take into account all of the home buyers’ debts. There are debts that lenders do not know about but are crucial and necessary for borrowers.

VA Loans For First Time Veteran Home Buyers: Debts Not Factored By Mortgage Underwriters When Calculating DTI

Here are some debts that do not factor in when mortgage underwriters calculate how much house buyers qualify for:

  • Utility Bills
  • Medical Insurance
  • Home Maintenance
  • School Tuition
  • Child and Elderly Care
  • Personal Expenses
  • Vacation
  • Other expenses

VA Guidelines Versus Lender Overlays

What is the difference between VA guidelines and lenders overlays

Gustan Cho Associates is one of a few lenders with no overlays on VA loans.

Here are basic VA Mortgage Guidelines versus typical VA Lender Overlays:

  • 100% financing with no money down

Buyers normally do not have to worry about closing costs:

  • VA allows 4% sellers concessions
  • If short with sellers concessions, lender credit by the lender to cover closing costs in lieu of slightly higher mortgage rates

VA does not have any minimum credit score nor debt to income ratio requirements:

  • Most lenders have lender overlays on credit scores where they require 620 credit score
  • Typical lender overlays are 45% debt to income ratios when the VA does not have caps on DTI

Charged off and collections do not have to be paid:

  • Even though VA does not require charged off and collections to be paid, many lenders required them to be paid off due to their own overlays
  • Two year wait period after housing event to qualify for VA Home Loans
  • Two year wait period after Chapter 7 discharge date
  • Borrowers can qualify one year into a Chapter 13 Bankruptcy repayment plan
  • No waiting period after Chapter 13 Bankruptcy to qualify for VA loans

Homebuyers who need to qualify for VA loans with a national lender with no overlays on government and conventional loans, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at

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