Caliber Home Loans, Inc. recently hosted a special Military Appreciation Month webinar on VA lending featuring David Schroeder, Caliber Executive VP of Third-Party Originations, and Jeff Wilson, Caliber VP of Military and Veteran Lending.
Click here to watch the entire webinar, and to download the presentation, click here.
We received a variety of questions from the nearly 500 webinar attendees, which Jeff Wilson has answered below.
Answer from Jeff Wilson, VP of Military & Veteran Lending
- Will VA renovation loans be offered by Caliber anytime soon? How about VA construction?
We are currently testing the VA Reno program in retail and hope to evaluate the success and open it to our Wholesale partners. We do not expect to offer VA construction in the near term.
- Would Caliber be able to do a loan for a Vet with only 6 months on the job and a job gap for a few years due to a motorcycle accident? Current job is full time and likely to continue. He went to school in 2016 -2018, hasn't been able to work because of injury. AUS Approval
- Is there a separate condo department that does just VA condos, or is it the same department used for all condos?
- Do you have any connection with or interactions with the National Homes for Heroes Program?
We do not currently.
- What are the email addresses for VA Support and for Certificates of Eligibility, and what’s the difference in what they’ll answer?
- Do you have any experience with VAREP, VA Real Estate Professionals?
I serve on both the National Education Committee and an advisor for the National Legislation Committee.
- My understanding is that VA loans will not let a borrower pay over appraisal amount which makes them less competitive in current markets conditions. Is this accurate?
That is inaccurate. VA will allow the Veteran to pay what they want for the home. However, if the purchase price exceeds the appraised value, the Veteran must pay the difference in cash from their own resources, the funds cannot be borrowed or gifted.
- Regarding Condo research - Caliber doesn't do this research, so who pays for the fee(s) associated with obtaining the paperwork on the associations that are passed on to us?
The fees for research actually can be paid by many different people. The seller, by offering the property as VA allowable should have already determined if the association was VA compliant and approved. The listing agent holds that responsibility for listing the home available to Veterans. The Veteran could since they want to buy the condo. As the broker, you also could since it is your loan to bring. That said, most associations have online or services online to get the required docs. Fees are low or not charged. Some documents must come from the association such as the letter from management regarding litigation and occupancy.
- Why doesn’t Caliber order the appraisals?
As the broker lender, VA considers the appraisal order to be your responsibility so that you are registered in the VA Portal and Caliber is only the sponsor lender. If we order it, then the broker is not listed, and VA considers this improper. All broker appraisals should be associated with the broker so VA can track the broker participation.
- What’s the reason for us to disclose to borrowers when we are only the “middle man”?
As the Broker, you are the original lender and generally the file is in an actionable status for disclosure before it is assigned to Caliber. Therefore, to meet legal disclosure laws, the broker should be doing this when all 6 items have been collected that constitute a full application requiring 3 day disclosures.
- Where can I get a copy of the VA Handbook?
- Do condos need to be pre-approved, like FHA? Is there a list of VA-approved condos? So just to understand, Caliber will prepare the Condo Project review?
All condos have to be approved by VA. There is no accessible consolidated list, but you can research the list online at: Loan Guaranty (va.gov)
We will submit the request to VA if the project is not VA approved. Please be sure to plan for the time it takes to obtain a VA approval. From the time we receive the complete package, we have a five-day SLA for review, and VA takes about two weeks to review.
- Is there a list of items needed for a condo approval? How do we contact the condo approval team?
The condo team at ProjectReview@caliberhomeloans.com can provide you with a list of the required docs and once received will upload and establish the request at VA. They include:
- VA Questionnaire
- Confirms presale, Litigation and Special Assessment.
- RECORDED Legal Documents
- Master Deed/Declarations/CC&Rs
- By Laws
- Plat Map
- Rules and Regulations
- Articles of Incorporation
- Last 2 Meeting Minutes
- Are we able to do a VA loan in a flood zone?
Yes you can, as long as the home is eligible for flood insurance.
- Is there a minimum credit score for a VA loan?
VA does not require a minimum score. Caliber has a minimum FICO of 580 with a minimum 600 for manual underwriting cases.
- If I took the course and lost the book, how do I get another copy of it?
- On a joint loan, does the non-veteran have to be a family member? Can they be a non-occupant coborrower as long as the veteran is living in the property as their principal residence?
Anyone can be a co-borrower on a VA Joint Loan. Any Veteran using their entitlement must occupy as their primary residence. A non-Veteran co-borrower can be a non-owner occupant. The Veteran must qualify from an income and credit standpoint for their portion of the loan.
- Are VA-specific customizable marketing materials available?
- Do both spouses need to be veterans to go on a VA loan?
No, VA considers the spouse along with the Veteran without considering it as a joint loan. If the spouse is also a Veteran, he/she can use their entitlement as well, but it is usually not recommended unless it will affect the funding fee charged. There is no real benefit to using a spouse’s entitlement as well.
- The VA Amendatory clause is problematic getting offers accepted in the California market. Any conversations at VA about eliminating this requirement?
The requirement is in the law so VA can’t waive it. However, the clause should never be problematic. The borrower is not locked in and can pay more if they want. They can sign an additional price guaranty indicating that they will pay more than the appraisal. Just be very careful to limit the amount because it has to come from borrower’s resources and cannot be borrowed or gifted to the borrower. VA does not have an issue with this, but the escape clause must be signed.
- Do you have to be honorably discharged to be eligible?
From Active duty, no. You can have less than honorable, but the COE may not be issued immediately as VA may need to adjudicate the discharge to determine if it can be administratively upgraded for loan purposes. Reserve and National Guard must be Honorable; nothing less is acceptable.
- How do I register for the Certified Veterans Lending Specialist course?
- Hello, I don’t really get why a VA loan is perceived as disadvantageous versus a Conventional loan. Could you please help me point out some things that sellers may be misunderstanding about VA loan? Thank you!
- Sorry, I’m new to VA lending. What’s a joint loan, and can you explain them in a little more detail?
Joint loans are when someone other than the Veteran’s spouse is on the title, deed, or note. These are acceptable but VA will only guaranty the Veteran’s portion of the loan. This would then require a down payment to cover the remaining equity/guaranty for GNMA purposes. GNMA requires 25% guaranty or equity or combination of the two. For example, a Veteran and co-borrower would require a 14.3% down payment to cover the portion of the loan that VA does not guaranty.
- Will you share the calculators?
The VA calculators can be found on Allregs. Log into our Blueprint portal and follow this path in the left navigation pane: Wholesale Broker (EXTERNAL) > Forms > VA
- Wholesale Employee (INTERNAL Only) > Resources > Product Specific > VA > VA Joint Loan Calculation Worksheet - 2022
- Wholesale Employee (INTERNAL Only) > Resources > Product Specific > VA > VA Loan Calculation Worksheet - 2022
- Wholesale Employee (INTERNAL Only) > Resources > Product Specific > VA > Simple Max Loan Calculation Worksheet
- Wholesale Broker (EXTERNAL) > Forms > VA > VA Joint Loan Calculation - 2022
- Wholesale Broker (EXTERNAL) > Forms > VA > VA Loan Calculation Worksheet - 2022
- Wholesale Broker (EXTERNAL) > Forms > VA > Simple Max Loan Calculation Worksheet
- How do we know when the VA Handbook doesn’t address a specific issue and defers to the HUD handbook?
VA never defers to the HUD handbook. HUD rules have no impact on VA with one exception: VA defers to HUD foundation rules for manufactured homes.
- I thought the VA credit score average provided was a range?
VA does not have a FICO requirement. Caliber has a FICO overlay listed in our product guidelines.