VA LOANS
Veterans Administration Joint Loans
An eligible veteran is a person who served on active duty in the Army, Navy, Air Force, Marines, or Coast Guard, cadets at service
academies, and Public Health Service Officers, and who, (except for a service member on active duty) was discharged or released
from active duty under conditions other than dishonorable; or Members of the Reserves and National Guard are eligible upon
completion of 6 years of service; or surviving spouses of certain Veterans who are in receipt of Dependency Indemnity
Compensation (DIC) from VA. If under age 57 cannot be remarried.
The Certificate of Eligibility will indicate the amount of available basic entitlement.
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All VA loans require a 25% guaranty/equity to meet secondary marketing requirements. See table on the next page for maximum potential guaranty
assuming the veteran has full entitlement. In addition, the VA does not impose maximum statutory loan limits; however, VA does publish county loans limits to
determine how much the VA will guaranty on a specific loan. Our maximum VA loan amount is $1,200,000 and all loans require 25% guaranty/equity.
• Secondary Market Requirements:
o The amount of cash down payment plus the amount of available VA guaranty must equal at least 25% of (i) the purchase price of the property or
(ii) the reasonable value of the property, whichever is less. The funding fee charged by VA must not be included in this calculation.
▪ The cash down payment must also include the amount, if any, by which the purchase price exceeds the reasonable value of the property.
▪ The cash down payment may not be derived from a second mortgage on the property.
• Prior Approval: Any joint loan (see below) for which the veteran will hold title to the property and any person other than the veteran’s spouse must be
submitted for prior approval. Any loan for which the veteran and the veteran’s spouse will hold title to the property, whether or not the spouse also uses
entitlement, may be closed automatically by a lender with automatic authority. Any prior approval loan requires a manual underwrite.
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VA Joint Loans must be prior approved by the VA.
Guaranty is limited to that portion of the loan allocable to the
veteran’s interest in the property. VA considers a Veteran’s spouse as the Veteran unless the spouse is also using entitlement on the loan. Joint Loans
require special handling by VA for determining the amount of Guaranty on the loan and the lender for determining secondary market (GNMA)
requirements. These loans usually do not have sufficient entitlement/guaranty to meet secondary market requirements and, if they do, must be sent to VA
for Prior Approval.
“Joint loan” generally refers to a loan for which:
o a veteran and another person(s) are liable, and
o the veteran and the other obligor(s) own the security.
o the veteran and another person to be included on title but not an obligor on the loan.
A joint loan is a loan made to:
o the veteran and one or more nonveterans (not spouse),
o the veteran and one or more veterans (not spouse) who will not be using their entitlement,
o the veteran and the veteran’s spouse who is also a veteran, and both entitlements will be used, or
o the veteran and one or more other veterans (not spouse), all of who will use their entitlement.
A loan involving a veteran and his or her spouse will not be treated as a “joint loan” if the spouse: is not a veteran, or
o is a veteran who will not be using his or her entitlement on the loan.
