VA Pamphlet 26-7, Lender’s Handbook, Chapter 4, Credit Underwriting, has been revised in its entirety.
- Chapter 4 has been revised to provide updated guidance for credit underwriting, to facilitate electronic processing of loans and to incorporate all applicable outstanding Circulars. Lenders are encouraged to apply flexibility and reasonable judgement when reviewing loan applications from Veterans who are seeking to use their VA home loan benefits. Key changes include:
- Chapter 4, Topic 2 includes additional details for analyzing income derived from commissions and rental income.
- Chapter 4, Topic 2 has been updated to reflect that service providers of Verifications of Employment (VOEs) do not need to be approved by VA, as long as the VOE meets the requirements listed within this topic. A current paystub is not required with an automated employment verification service.
- Chapter 4, Topic 2 notes that VA disability income verification will be placed on the Certificate of Eligibility (COE) except in certain instances which arc listed within this topic.
- Chapter 4, Topic 7 covers additional details for analyzing the borrower’s credit history.
- Chapter 4, Topic 8 lists updated documentation required for Automated Underwriting Cases.
This change is effective 90 days from the date of approval (The date of approval is 2/22/2019; effective date is 5/23/2019).