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Getting a VA loan with family member on the mortgage

My brother was not in armed forces but we would like to share a house while we still build up our finances. Can we do this? I am the VA eligible party. My fico is 712 and his is even better 731. We WOULD like to put money down if possible to lower monthly payment as much as possible by kevinsota87462940 from Indianapolis, Indiana. Sep 19th 2014 Reply


Larry Penilla (Larry Penilla)
#4 ranked lender in Indiana - 22 contributions

1.Those in the market for a VA Home Loan may find themselves in need of a co-borrower to secure mortgage financing. Adding a co-borrower to your mortgage can be beneficial when lacking the income, assets or credit needed to qualify.The VA wants borrowers to have a DTI ratio of 41 percent or less. And, even though that's not a make-or-break figure, depending on residual income, a potential homebuyer may need a co-borrower to help pick up the slack. For example: a homebuyer whose debt-to-income ratio maxes out with home values greater than $200,000 would need a co-borrower with a strong financial portfolio if they were to consider homes greater than $200,000.The VA Loan traditionally permits co-borrowers to sign on the loan when they are either your spouse or another veteran who will occupy the home. However, the Department of Veterans Affairs wants every eligible veteran, interested in homeownership, to have access to the VA Home Loan. This is why the VA does not forbid co-borrowers who don't fall in a traditional category above.The caveat to this is that the VA will only guarantee the eligible borrower's portion of the loan, resulting in the need for a down payment from the co-borrower who is signing on the loan. The down payment required is normally 12.5 percent to cover the loss of the other half of the guarantee. Co-borrowers signing onto a VA Home Loan should realize that their information will be reviewed just as carefully as the primary homebuyer. Additionally, co-borrowers are equally responsible for ensuring that the lender is paid on time. When the lender is paid on time, both borrowers benefit, just as if a payment is missed, both would be penalized. Larry Penilla www.LarryTheMortgageGuy.com

Sep 19th 2014
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Dave Metsker (DaveMetsker)
#37 ranked lender in Oregon - 2,317 contributions

Yes, see Larry's god explanation.

Sep 19th 2014
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Larry Gray (lgray_312_247)
#565 ranked lender in California - 1,127 contributions

In that excellent answer from "LarrytheLoanGuy" you probably figured Larry Penilla is good choice to contact and have him qualify you since he can accept your brother on the loan with a down payment involved!

Sep 19th 2014
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Michael Patterson (MichaelPatterson)
#52 ranked lender in Washington - 71 contributions

This type of scenario is defintely allowed by the VA, although it is more common to see a husband / wife situation with non-veteran co-borrowers. The down payment would be based on your eleigbility, as evidenced by the Certificate of Eligibility obtained. The VA would only insure your portion against loss, however. Therefore, a downpayment would be required, but it sounds like that was your goal already .Speak to a licensed loan officer in your state and make sure they can effectively answer this question as well.

Sep 22nd 2014
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