Many people today are using VA loans for home purchases since there are numerous benefits including 100% financing. A VA joint loan is one for which the veteran and another person own the property and are both liable. This includes:
-the veteran and one or more non-veterans (not spouse)
-the veteran and one or more non-veterans who will not use their entitlement (not spouse)
-the veteran and one or more other veterans, all using entitlements (not spouse)
-the veteran and spouse who is a veteran, both using entitlements (a veteran and spouse who is not a veteran or one that is a veteran but not using their entitlement is not considered a joint loan)
Occupancy Requirements for a Joint Loan
-the veteran who uses their entitlement on a joint loan must certify that they will occupy the home as their primary residence.
-any borrower on a VA joint loan who does not use entitlement does not have to occupy the property.
While a VA joint loan is permitted by the VA, there are some conditions. The VA guaranty is only extended to the veteran and their portion of the loan. The other applicant is not backed by the VA loan guaranty. Because of this, some lenders may require a down payment on the non-guaranteed portion of the loan.
As with any other type of loan, both individuals can use their income and credit information for qualifying for the VA joint loan. Credit information from the co-borrower does affect the status of the VA loan. Since it is a joint loan, the veteran must be able to prove that their income is sufficient to cover their portion of the loan. The co-borrower is not permitted to take on the responsibility for repayment of the loan through their income alone.
VA joint loans are unusual and have different guidelines than normal VA loans. For this reason, lenders must submit joint loans to the VA for approval before the loan is issued. In addition, borrowers may need to shop around for a lender who offers VA joint loans since this type of VA mortgage does not have the full VA guaranty. However, the VA does not require prior approval on a joint loan where both spouses are veterans who want to use their entitlement on the home together.
My loan process was very easy and quick. Not to mention a great loan rate. I couldn't be happier!
Capt Sam T. - US Army
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