VA Underwriting Guidelines VA Underwriting Guidelines | Table of Contents Table of Contents MiMutual Underwriting ____________________________________________________________________ 9 Philosophy _________________________________________________________________________________________ 9 Program Description________________________________________________________________________________ 10 Requirements and Restrictions _____________________________________________________________ 11 Loan Requirements_________________________________________________________________________________ 11 Loan Restrictions (Ineligible) _________________________________________________________________________ 11 Qualified Mortgages with Rebuttable Presumption _____________________________________________________ 11 Maximum LTV / CLTV _______________________________________________________________________________ 12 Purchase of Existing Properties ___________________________________________________________________________________ 12 New Construction by Property Type _______________________________________________________________________________ 12 Home Built FOR Veteran on Lot Acquired by Veteran _____________________________________________________________ 12 Home Built BY Veteran on Lot Acquired by Veteran _______________________________________________________________ 12 Property (House and Lot) Purchased From Builder as Package _____________________________________________________ 12 Property Construction was Financed by a Construction Loan _______________________________________________________ 13 Cash-Out Refinance _____________________________________________________________________________________________ 13 Paying off an Installment Land Contract ____________________________________________________________________________ 13 IRRRLs _________________________________________________________________________________________________________ 13 Collateral Requirements___________________________________________________________________ 14 Eligible Collateral __________________________________________________________________________________ 14 Ineligible Collateral_________________________________________________________________________________ 14 Appraisals ________________________________________________________________________________________ 15 Ordering an Appraisal____________________________________________________________________________________________ 15 VA Case Number Assignments ____________________________________________________________________________________ 15 VA Appraisal Assignment _________________________________________________________________________________________ 15 Appraisal Requirements__________________________________________________________________________________________ 16 Uniform Appraisal Dataset (UAD) _________________________________________________________________________________ 16 Compliance Inspection Report (VA Form 26-1839) __________________________________________________________________ 16 Appraisal Rebuttal Process _______________________________________________________________________________________ 16 Revisions Due to Sales Contract Amendments ______________________________________________________________________ 17 Appraisal Portability/VA Case Transfers ____________________________________________________________________________ 17 Appraisal Validity Period _________________________________________________________________________________________ 17 Appraisal Delivery Requirements __________________________________________________________________________________ 17 Modular Home Eligibility ____________________________________________________________________________ 18 Minimum Property Requirements ____________________________________________________________________ 18 FEMA Declared Disaster Area Policy __________________________________________________________________ 19 Repair Escrows ____________________________________________________________________________________ 19 Required Repairs___________________________________________________________________________________ 19 Acreage __________________________________________________________________________________________ 19 Estimated Remaining Economic Life___________________________________________________________________ 19 Commercial/Industrial Zoning _______________________________________________________________________ 20 Properties Listed for Sale within the Last 6 Months (Refinances) __________________________________________ 20 Attic _____________________________________________________________________________________________ 20 Crawl Space _______________________________________________________________________________________ 20 Roof _____________________________________________________________________________________________ 20 Inspection and Life Expectancy____________________________________________________________________________________ 20 Snow Covered Roof______________________________________________________________________________________________ 20 Multiple Parcels of Land ____________________________________________________________________________ 21 Property Seasoning_________________________________________________________________________________ 21 05.21.2018 2 VA Underwriting Guidelines | Table of Contents Termite Inspections ________________________________________________________________________________ 21 Termite Inspections on New Construction Properties ________________________________________________________________ 21 Water and Sewage Systems Requirements _____________________________________________________________ 22 Individual Water Supply System (Well) _____________________________________________________________________________ 22 Shared Well ____________________________________________________________________________________________________ 23 Community Well ________________________________________________________________________________________________ 23 Water Testing___________________________________________________________________________________________________ 24 Water Purification Systems _______________________________________________________________________________________ 24 Individual Sewage System (Septic)_________________________________________________________________________________ 25 Distance Between the Well and the Septic System __________________________________________________________________ 25 Access to Property _________________________________________________________________________________ 25 Access to Living Unit________________________________________________________________________________ 25 Access to Rear Yard ________________________________________________________________________________ 25 Party Walls________________________________________________________________________________________ 26 Gas and Petroleum Pipelines ________________________________________________________________________ 26 High Voltage Electric Transmission Lines _______________________________________________________________ 26 Lead-Based Paint __________________________________________________________________________________ 26 Planned Unit Developments (PUDs)___________________________________________________________________ 26 New Construction __________________________________________________________________________________ 27 Construction Warranty___________________________________________________________________________________________ 27 Condominiums __________________________________________________________________________ 28 Condominium Property Eligibility_____________________________________________________________________ 28 Eligible _________________________________________________________________________________________________________ 28 Ineligible _______________________________________________________________________________________________________ 28 Insurance Requirements ____________________________________________________________________________ 28 Hazard/Liability Insurance (Project Approval) _______________________________________________________________________ 28 HO-6 (Loan Level) _______________________________________________________________________________________________ 29 Fidelity Bond / Fidelity Insurance (Project Approval) _________________________________________________________________ 29 Flood (Project and Loan Level) ____________________________________________________________________________________ 29 Site Condominiums_________________________________________________________________________________ 30 Condominium Conversions __________________________________________________________________________ 30 Credit__________________________________________________________________________________ 31 Documentation Requirements _______________________________________________________________________ 31 Verification of Institutional Mortgage History _______________________________________________________________________ 31 Verification of Rental Payment History_____________________________________________________________________________ 31 Land Contract/Contract for Deed__________________________________________________________________________________ 31 Lease with Option to Purchase ____________________________________________________________________________________ 31 Credit Reports _____________________________________________________________________________________ 31 Housing