Despite the reams of documents and sophisticated computer programs, home lending is ultimately a business comprised of human beings.
That means there’s always a chance for something to go wrong, even though the VA loan process isn’t more difficult than any other loan type. In fact, VA loans continue to be more likely to close than their conventional counterparts.
Simple mistakes, oversights and paperwork flubs do occur. Most of the problems that could affect your loan are easily fixed, if not easily preventable.
Here’s a look at five common problems that can complicate the process:
1. Application errors
Double check your loan paperwork. Most mistakes are caught early on and can be easily fixed, but you don’t want something slipping through the cracks. Underwriters are sticklers for accuracy. Income that cannot be verified, debt that wasn’t disclosed or even minor errors like family size can turn into problems later. Sometimes the problem creates a delay; sometimes it’s a deal-breaker. Help us help you by making sure your information is accurate.
2. Change in employment
Keep your employment consistent throughout the loan process. If a change is necessary, be sure to talk to your loan officer. An underwriter may consider income from a new job to be unreliable, so it’s important to plan ahead. Even a good career move may trigger a whole new set of documentation and verifications.
3. Change in credit
Before your loan closes, the underwriter will re-verify your credit to make sure you didn’t lease a yacht, default on your car loan or do something else that could affect your approval. Even little things can throw up red flags. Avoid credit checks whenever possible and resist the urge to take out any new debt until your loan has closed. Keep a lid on your spending as the process unfolds. Remember that new debts could affect your debt-to-income ratio, your purchasing power and ultimately your ability to qualify for your VA home loan. You can read more about what DTI is and how to keep it under control.
4. Borrower Delays
An underwriter might ask for additional financial statements and other information. Make sure you understand the requests and talk with your loan officer if you’re unsure. Your loan officer may be able to find alternate ways to satisfy the requirement. Underwriters will not issue final loan approval until they have reviewed every piece of required documentation, so a prompt response is key.
5. Factors beyond your control
If you’re following the above steps and maintaining good communication with your loan officer, go ahead and relax. Sure, the seller could back out on the deal. The inspection could turn up a cracked foundation and a termite infestation, but these things are beyond your control. We’ve seen just about everything that can happen, and will be there to get you through it.
If you’re concerned about what the VA loan process may look like for you, speak with a Veterans United loan specialist about your specific situation anytime at 855-524-7279, or get started online today.