What is the Maximum Debt Ratio for a VA Home Loan?

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
#1
VA home loans are by far some of the most flexible in the marketplace when compared to conventional or FHA. They will typically go to a lower FICO score, be more flexible on requirements for previous derogatory events as well.

If you read VA guidelines, there is no debt ratio maximum written anywhere! What you will see is what is called residual income requirements. Meaning that a VA borrower will have to meet certain requirements (outside of the debt-ratio) to qualify. Within the residual income, there are factors like child care, income taxes, maintenance and number of children. All these fields must be filled out to get an accurate reading on the automated underwriting system.

Many cases, homeowners find what I have written about after being declined a loan that they were originally approved for. Loan officers, especially ones that are not VA experts will overlook this requirement and not fill in the required information. Half way into processing or underwriting you’re being told that unfortunately you don’t qualify.

Now there may not be a remedy for a denial of this sort if you were to reach out to me but I would be happy to discuss in more detail what this means and how you can potentially avoid it in the future. Please give us a call at 800-779-4547 or e-mail at: [email protected]