What is the Maximum Debt Ratio- (aka DTI) with a VA Loan with QM?
There has been much talk about how QM will result in more denials for VA Home Buyers using VA Financing due to new Federally Mandated restrictions regarding Mortgage Loans. QM is also known as Qualified Mortgages, as defined in the Dodd-Frank legislation. QM went into effect the same time as ATR, in January, 2014, ATR stands for Ability to Repay. This basically codified how and what lenders must verify, document and consider when qualifying VA borrowers for VA Loans under QM/ ATR. VA stands for the Federal Housing Administration.
Fortunately, the legislation gave the "agencies" such as VA up to 7 years to come up with their own QM rules. So the quick answer is that the Max DTI (Debt to Income Ratio) for VA continues to be 50% for qualified Borrowers. We are even able to make exceptions and exceed 50% for well qualified borrowers on VA and VA Jumbo Loans.
Under QM, VA loans are available up to VA county Loan Limits with ZERO down payment required. Most conventional loans require 5% down up to $417k, and 10% down above that figure. VA Loans are available up to $625,500 in the Bay Area, $625K in LA / OC counties with zero down required.
The real point to this post is that you must work with a VA Loan Professional that knows the guidelines and rules so that you can get the right loan for the home you want. Calll the Loan Pros at VanDyk Mortgage at 866-900-2342 direct or apply online at vandykfunding.com.
We service homebuyers in CA, GA, IN, MA, MI, VA, WA and WY.