Debt To Income Ratios On VA Loans

Views:
 
     
 

Presentation Description

"Jimmy Vercellino, VA Loan Specialist helps veterans obtain the loans they are entitled to. He served in the United States Marine Corps, and now devotes himself to the Veteran home buyer in the Phoenix area, fulfilling a passion of his while at the same time helping others achieve home ownership. Be a proud homeowner today. For more details call 480-351-5904 or visit the site https://www.valoansforvets.com/ VA Loans for Vets 7702 E. Doubletree Ranch Road, Suite 220 Scottsdale, AZ 85258 Phone: (480) 351-5904 Email: jimmyv@fcbmtg.com"

Comments

Presentation Transcript

slide 3:

The United States of America appreciates all those serving and who have served in the armed forces.

slide 4:

They are honored in parades and patriotic ceremonies. And “Thank you for your service” is a common sentiment expressed towards veterans.

slide 5:

But it’s always meaningful to receive more tangible recognition. To this end the U.S. Department of Veterans Affairs guarantees home loans for qualified veterans.

slide 6:

In so doing the government makes financing a home easier and more affordable for those who have served.

slide 7:

A significant attraction of VA loans is the debt-to-income ratio threshold. It is higher than would be acceptable in a conventional mortgage.

slide 8:

THE CREDIT PROCESS

slide 9:

Mortgage loan underwriters look at several variables before approving a loan application. For one thing they want to know how much equity the applicant will have in the house.

slide 10:

They measure the loan amount against the appraised worth of the property. This calculation is called the loan-to-value ratio.

slide 11:

Another area of interest is credit rating. Does the prospective borrower have a history of paying bills on time

slide 12:

By the same token lenders want to be reasonably sure that loan applicants will continue to make timely payments.

slide 13:

Therefore a determination is made as to whether the loan is affordable. This assessment is made by means of a debt-to-income ratio DTI.

slide 14:

LOAN DEBT SERVICE

slide 15:

Credit analysts at banks and finance companies take a hard look at monthly payments reflected on a credit report e.g. credit cards student loans cell phones cable TV.

slide 16:

These payments are combined with the calculated monthly payment for the home loan. This total often includes escrows for taxes and insurance.

slide 17:

The monthly burden is weighed against monthly revenue from employment investments and earned interest for example. These figures create a debt-to-income ratio.

slide 18:

If the figure falls outside a given range whereby the debt is too high or the income is too low the bank may reject the application because the loan payments are not affordable.

slide 19:

Even if past credit history is sterling this ratio can kill an otherwise strong application.

slide 20:

WHAT MAKES A VA LOAN DIFFERENT

slide 21:

Since the Dept. of Veterans Affairs guarantees these loans that is promises to pay them off in the event of default banks and other lenders are more flexible with approval standards.

slide 22:

Borrowers can get by with less or even zero equity for example than would be demanded in a conventional loan.

slide 23:

Credit scores need not be as high. Most significantly the standard DTI ratio is 36 for a conventional loan whereas it is 41 for a VA loan.

slide 24:

Hence a VA borrower can have up to 41 of gross income consumed by monthly obligations. This is an easier benchmark to meet.

slide 25:

Furthermore if residual or tax-free incomes make up an appreciable amount of the gross lenders have some flexibility to raise the DTI by a few points.

slide 26:

Many veterans still choose conventional loans to finance their houses. However when budgets are tight and expenses are high they do have the VA loan option.

slide 27:

It provides a little more financial breathing room to pursue the American dream which vets have certainly earned.

slide 28:

Mortgage Originator Jimmy Vercellino specializing in VA loans helps veterans use their VA loan benefit to their greatest advantage.

slide 29:

For more details call 480-351-5904. Visit the site at

slide 30:

VA LOANS FOR VETS 7600 E. Doubletree Ranch Road 200 Scottsdale AZ 85258 Phone: 480 351-5904 Email: jimmyvfcbmtg.com

authorStream Live Help