Lenders who specialize with VA loans

[Mike Hoherchak]

I'm looking at purchasing a small multifamily (2plex, 3plex or 4plex) as an owner occupied using a VA loan. I know every lender is different but I was curious to know what are the requirements in order to qualify. I understand one of them is 2 years of income. I just started a new job with a rather long unemployment gap. Would the rent roll help with overcoming that hurdle? Or does it stop me in my tracks? Any help is appreciated.

Thanks in advance!

[Corey Blane]

Hi @Mike Hoherchak

VA is probably one of the most lenient ways to finance a home purchase.

This morning I was able to get a Veteran approved who had a bunch of credit issues, foreclosure 4 years ago, overdraft fees in his bank account, negative bank balance, high debt ratios and a whole host of other challenges. The good news is he had a very solid explanation for why this was all happening which is what got him over the hurdle.

As you mentioned this is lender specific but 620 is the minimum FICO score required. 

The employment GAP isn't always an issue as long as you're now a W2 employee, can show 30 days of pay stubs (not self employed), and you can provide a letter of explanation stating the cause of the employment gap.

For a VA loan, in order to use the rental income from the other units you'll need:

1. Cash reserves totaling 6 months (principle, interest, taxes and insurance [PITI])

2. Documentation of applicants prior experience managing rental units or other background involving property maintenance. 

As for debt to income ratio I've gotten VA loans approved up to 55% (i.e. client makes $6,000/month and had total monthly debt payments (including the new mortgage PITI] of $3,250/month).

Let me know what other questions you have. I'm happy to help even though I'm not licensed in PA the underwriting guidelines are going to be basically the same from lender to lender. 

@Kyle Gray I'm licensed in CA so if you have questions about VA feel free to let me know and I'll answer them to the best of my ability.

Thanks!