VA Underwriting Guidelines VA Underwriting Guidelines | Table of Contents Table of Contents MiMutual Underwriting ___________________________________________________________________ 10 Philosophy ____________________________________________________________________________________ 10 Program Description ____________________________________________________________________________ 11 Requirements and Restrictions _____________________________________________________________ 12 Loan Requirements _____________________________________________________________________________ 12 Loan Restrictions (Ineligible) _____________________________________________________________________ 12 Maximum LTV / CLTV ___________________________________________________________________________ 12 LTV Calculation for Applications Taken on/after February 15, 2019 _______________________________________________ 12 Purchase of Existing Properties ____________________________________________________________________________ 13 New Construction by Property Type ________________________________________________________________________ 13 Home Built FOR Veteran on Lot Acquired by Veteran ________________________________________________________ 13 Home Built BY Veteran on Lot Acquired by Veteran _________________________________________________________ 13 Property (House and Lot) Purchased From Builder as Package ________________________________________________ 13 Property Construction was Financed by a Construction Loan __________________________________________________ 14 Cash-Out Refinance _____________________________________________________________________________________ 14 Paying off an Installment Land Contract _____________________________________________________________________ 15 IRRRLs ________________________________________________________________________________________________ 15 Higher Priced Mortgage Loans ____________________________________________________________________ 15 Collateral Requirements __________________________________________________________________ 16 Eligible Collateral ______________________________________________________________________________ 16 Ineligible Collateral _____________________________________________________________________________ 16 Appraisals ____________________________________________________________________________________ 17 Ordering an Appraisal ___________________________________________________________________________________ 17 VA Case Number Assignments_____________________________________________________________________________ 17 VA Appraisal Assignment _________________________________________________________________________________ 17 Appraisal Requirements __________________________________________________________________________________ 18 Uniform Appraisal Dataset (UAD) __________________________________________________________________________ 18 Compliance Inspection Report (VA Form 26-1839) ____________________________________________________________ 18 Appraisal Rebuttal Process _______________________________________________________________________________ 18 Revisions Due to Sales Contract Amendments ________________________________________________________________ 19 Appraisal Portability/VA Case Transfers _____________________________________________________________________ 19 Appraisal Validity Period _________________________________________________________________________________ 19 Appraisal Delivery Requirements __________________________________________________________________________ 19 Modular Home Eligibility ________________________________________________________________________ 20 Minimum Property Requirements _________________________________________________________________ 20 FEMA Declared Disaster Area Policy _______________________________________________________________ 21 Repair Escrows ________________________________________________________________________________ 21 Required Repairs _______________________________________________________________________________ 21 Acreage ______________________________________________________________________________________ 21 Estimated Remaining Economic Life _______________________________________________________________ 21 Commercial/Industrial Zoning ____________________________________________________________________ 22 Properties Listed for Sale within the Last 6 Months (Refinances) ________________________________________ 22 Attic _________________________________________________________________________________________ 22 Crawl Space ___________________________________________________________________________________ 22 Roof _________________________________________________________________________________________ 22 Inspection and Life Expectancy ____________________________________________________________________________ 22 Snow Covered Roof _____________________________________________________________________________________ 22 Multiple Parcels of Land _________________________________________________________________________ 23 04.22.2019 2 VA Underwriting Guidelines | Table of Contents Property Seasoning _____________________________________________________________________________ 23 Termite Inspections ____________________________________________________________________________ 23 Termite Inspections on New Construction Properties __________________________________________________________ 23 Water and Sewage Systems Requirements __________________________________________________________ 23 Individual Water Supply System (Well) ______________________________________________________________________ 24 Shared Well ___________________________________________________________________________________________ 25 Community Well _______________________________________________________________________________________ 25 Water Testing __________________________________________________________________________________________ 26 Water Purification Systems _______________________________________________________________________________ 26 Individual Sewage System (Septic) _________________________________________________________________________ 27 Distance Between the Well and the Septic System ____________________________________________________________ 27 Access to Property _____________________________________________________________________________ 27 Access to Living Unit ____________________________________________________________________________ 27 Access to Rear Yard _____________________________________________________________________________ 27 Party Walls ___________________________________________________________________________________ 28 Gas and Petroleum Pipelines _____________________________________________________________________ 28 High Voltage Electric Transmission Lines ____________________________________________________________ 28 Lead-Based Paint _______________________________________________________________________________ 28 Planned Unit Developments (PUDs)________________________________________________________________ 28 New Construction ______________________________________________________________________________ 29 Construction Warranty __________________________________________________________________________________ 29 Condominiums __________________________________________________________________________ 30 Condominium Property Eligibility _________________________________________________________________ 30 Eligible _______________________________________________________________________________________________ 30 Ineligible ______________________________________________________________________________________________ 30 Insurance Requirements _________________________________________________________________________ 30 Hazard/Liability Insurance (Project Approval) ________________________________________________________________ 30 HO-6 (Loan Level) _______________________________________________________________________________________ 31 Fidelity Bond / Fidelity Insurance (Project Approval) ___________________________________________________________ 31 Flood (Project and Loan Level) ____________________________________________________________________________ 31 Site Condominiums _____________________________________________________________________________ 32 Site Condos in the State of Michigan _______________________________________________________________________ 32 Site Condos in all States Other Than Michigan ________________________________________________________________ 32 Condominium Conversions _______________________________________________________________________ 33 Credit __________________________________________________________________________________ 34 Documentation Requirements ____________________________________________________________________ 34 Verification of Institutional Mortgage History ________________________________________________________________ 34 Verification of Rental Payment History ______________________________________________________________________ 34 Land Contract/Contract for Deed __________________________________________________________________________ 34 Lease with Option to Purchase ____________________________________________________________________________ 34 Credit Reports _________________________________________________________________________________ 35 Housing Payment History ________________________________________________________________________