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Kentucky VA Home Loans offered by a Kentucky Veteran. I have successfully originated over 100 VA Kentucky Mortgages for fellow Kentucky Veterans and active duty personnel.$0 Down Home loans in KY. Free Credit Report and free pre-approvals. I can be reached by text or call at 502-905-3708, or kentuckyloan@gmail.com Not affiliated with VA Government Agency. NMLS #57916 Company NMLS #1364 Former Army Tanker 19k
Showing posts with label collections. Show all posts
Showing posts with label collections. Show all posts
Kentucky VA Home Loan Approval Requirements with Collections on Credit Report
Kentucky VA loan with outstanding collections and charge offs listed on the credit report?
Collections & Charge Offs are two different things. Below is what VA saying about them:
Collection Accounts
Isolated collection accounts do not necessarily have to be paid off as a condition for loan approval. A credit report may show numerous satisfactory accounts and one or two unpaid medical (or other) collections. In such instances, while it would be preferable to have collections paid, it would not necessarily be a requirement for loan approval.
However, collection accounts must be considered part of the borrower's overall credit history and unpaid collection accounts should be considered open, recent credit.
Borrowers with a history of collection accounts should have re-established satisfactory credit in order to be considered a satisfactory credit risk.
While VA does not require that collection accounts be paid-off prior to closing if the borrower's overall credit is acceptable, an underwriter must address the existence of the collection account(s) with an explanation on VA Form 26-6393, Loan Analysis, for excluding the negative credit history they represent.
If the collection account is listed on the credit report with a minimum payment, then the debt should be recognized at the minimum payment amount.
Charged off Accounts
These accounts are typically collections in which the creditor is no longer pursuing collection of the account. The underwriter must address the circumstances regarding the negative credit history when reviewing the overall credit of the borrower(s).
2 different topics best if you can send me credit to review.
· Charged off accounts generally ignored
· Collection accounts on Federal debt are a big issue so we careful there
· Collections not required to be paid off unless they are extremely high
· Manual Underwrite we do require an LOE from Veteran for collections
· What happened, what they did to resolve, what are they doing in the future to either resolve or to prevent this from happening and finally if they are going to enter into a payment plan or not. Ultimately on the resolution of the collection the UW does not care but VA requires that as part of LOE.
Hope this helps send me credit for full evaluation.
The VA underwriter will want to verify the Kentucky Mortgage Veteran has the ability to pay these items or will want to know how they were paid off before closing.
Any collection or charge off showing as a judgement or lien on the VA mortgage applicant's credit report, must be paid before closing. These affect the title and must be paid before the mortgage is recorded
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Kentucky VA Mortgage Requirements for Bankruptcy, Foreclosure, Collections and Student loans.
Bankruptcy VA Mortgage Loan Requirements
Chapter 7 : 2 years from discharge date
•Chapter 13: No seasoning required if discharged. If open requires court approval and 0x30 last 12 months to trustee.
Borrower must demonstrate re-established credit since dismissal from Bankruptcy.
Judgments VA Mortgage Loan Requirements
•Judgments must be paid or in a repayment plan for 12 months with a most recent 0x30x12 timely payments.
Student Loans VA Mortgage Loan Requirements
•Monthly payment does not need to be considered if the Veteran or borrower provides written evidence that the student loan debt will be deferred at least 12 months beyond the date of closing
•Use payment shown on credit report (unless credit report reflects $0 or no payment amount).
Use Balance x 5% / 12 for payment
Foreclosure and VA Mortgage Loan Requirements
•Foreclosure - 2 years removed from sale date of home
Collection Accounts and VA Mortgage Loan Requirements
•Collection and charge-offs are generally not required to be paid off, however follow Desktop Underwriting Findings through Fannie Mae DU or Freddie Mac LP Findings automated underwriting systems if payoff is required.
•A letter of explanation is required for all collection/charge-off/judgment accounts.
•Collections and charge offs must be included in DTI at the amount on credit or 5% of balance if no payment shown.
•Borrowers with a history of collection/charge-off accounts should have re-established a 12 month satisfactory credit history.
American Mortgage Solutions, Inc.
10602 Timberwood Circle Suite 3
Disclaimer: No statement on this site is a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet Loan-to-Value requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines and are subject to change without notice based on applicant's eligibility and market conditions. Refinancing an existing loan may result in total finance charges being higher over the life of a loan. Reduction in payments may reflect a longer loan term. Terms of any loan may be subject to payment of points and fees by the applicant Equal Opportunity Lender. NMLS#57916http://www.
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