VA Overlays Versus VA Agency Mortgage Guidelines
This Article Is About VA Overlays Versus VA Agency Mortgage Guidelines
Gustan Cho Associates is a national mortgage company licensed in multiple states with no lender overlays on VA Home Loans.
- Over 75% of our borrowers come to us because they could not qualify for VA Loans due to not being able to meet the mandatory credit score requirements or debt to income ratio cap
- Many lenders will require a 620 to 640 minimum credit score
- Many lenders will cap debt to income ratios at 41% to 50%
- Wait a minute!!!
- The Department of Veterans Affairs does not have minimum credit score requirements
- The VA also does not have a maximum debt to income ratio cap
- Then why are these lenders require certain credit scores and debt to income ratio requirements?
The reason is because of VA Overlays.
What Are Lender Overlays?
All borrowers need to meet minimum VA mortgage guidelines to qualify for VA Home Loans:
- VA does not require a minimum credit score requirement
- VA, also does not have a maximum debt to income ratio cap
- As long as borrowers can get an approve/eligible per automated underwriting system, they meet all VA Agency Guidelines
- However, most lenders have VA Overlays on VA Home Loans
- Let’s take the example where The VA has no minimum credit score requirements
- However, most lenders will require a 620 to 640 credit score on VA Loans
- This credit score requirement is not by the VA but by the individual lender
- Other common VA overlays are debt to income ratios
- The VA does not mandate a maximum debt to income ratio if the borrower can get an approve/eligible per automated findings
- However, most lenders will cap debt to income ratios on VA loans to 41% to 50%
- The Great News is Gustan Cho Associates Mortgage Group has zero VA Overlays on VA Home Loans
- As long as borrowers get an approve/eligible per AUS Findings, we will approve, process, underwrite, and close the VA Loans
- The team at Gustan Cho Associates have approved and funded countless borrowers with credit scores down to 500 FICO and over 65% or higher DTI with an approve/eligible per automated underwriting system
Gustan Cho Associates has no additional lender overlays on top of the automated findings. Gustan Cho Associates are also experts in manually underwriting VA loans.
Typical Overlays Imposed By Lenders On VA Home Loans
Most lenders impose lender overlays on VA Home Loans. Gustan Cho Associates is one of the very few national mortgage companies licensed in multiple states with no Overlays on VA Loans.
Here are typical overlays most lenders impose on VA Loans:
- VA does not require a minimum credit score requirements but many lenders have overlays requiring certain credit score minimums
- VA does not have a debt to income ratio requirements
- Many lenders will cap DTI on VA Loans at 41% to 50%
- VA does not require borrowers to pay outstanding collections and/or charged-off accounts
- Most lenders will require derogatory credit tradelines and collections/charged-off accounts to be paid
- VA allows manual underwriting: Many lenders will not accept files that need to be manually underwriting
- VA allows homebuyers to qualify for VA Loans during Chapter 13 Bankruptcy repayment plan: Most lenders will not require this unless the Chapter 13 Bankruptcy has been discharged two years
- There is no waiting period after Chapter 13 Bankruptcy discharged date
Most lenders have overlays requiring 2 years seasoning after Chapter 13 bankruptcy discharge date. Gustan Cho Associates has zero lender overlays on VA loans. We just go by the automated underwriting system findings with no additional lender overlays.
Qualifying For VA Home Loans With Direct Lender With No Overlays
Homebuyers who are looking for a national mortgage company licensed in multiple states with no overlays, please contact us at Gustan Cho Associates at 262-716-8151 or text us for a faster response. Or email us at [email protected] The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. Over 75% of our borrowers are folks who could not qualify at other lenders due to their lender overlays. We have no lender overlays on government and/or conventional loans. We just go off the AUS Findings. We have no minimum credit scores on VA loans as long as the borrower can get an approve/eligible per automated underwriting system. We have no maximum debt to income ratio caps as long as the borrower can get AUS Approval.