VA mortgage loan guidelines recognize legally married spouses of qualified veterans as co-signors on VA loans. This means that we can include the spousal income to qualify for the loan, and that these loans can be fully guaranteed by the VA. Simply being engaged means that you can get pre-qualified with the spousal income, but the closing must take place after we have evidence of the marriage.
The VA mortgage loan guidelines also allow for more than one eligible veteran(s) to purchase a home. If a married couple with more than one eligible veteran is involved, VA divides the entitlement charge equally between them, if possible. If two unmarried eligable veterans purchase property together the same rules apply and these loans can be fully guaranteed by the VA.
While the VA guidelines may allow for a non-veteran to co-sign for a mortgage loan, they will not fully guarantee the loan, and in our 25 years of lending, we’ve never seen one of these loans close. Again, the VA mortgage loan was designed to offer long-term financing to American veterans or their surviving spouses (provided they do not remarry).
Although it seems more confusing than it is, the federal government does not generally make direct loans under the act. The government simply guarantees loans made by ordinary mortgage lenders (descriptions of which appear in subsequent sections) after veterans make their own arrangements for the loans through normal financial circles. The Veterans Administration then appraises the property in question and, if satisfied with the risk involved, guarantees the lender against loss of principal if the buyer defaults.
In the case of divorce, the Veterans Administration has several choices. If a non-eligable spouse continues to occupy the property and if the payments are made in a timely fashion, no change to the loan will be made. In this case, the military spouse will have their eligability for a mortgage re-instated once the loan is paid off and/or refinanced out of a VA loan. If payments are missed, and the property is approaching foreclosure, the VA might choose to refund the loan and have the payments made directly to the Veteran’s Administration.
For more information about purchasing a home in Raleigh with VA Financing or buying a home in Cary as a Veteran, please contact Steve and Eleanor Thorne with Connect With Us on Facebook in Cary, NC. 919-649-5058
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