1. Department of Veterans Affairs Puerto Rico Lender Training
ST Petersburg Regional Loan Center

2. PRESENTED BY REGIONAL LOAN CENTER ST. PETERSBURG, FLORIDA
Sharon Glanton-Davis, LPO
Monica Collins, ALPO
Steven Roberts, ALPO

3. Objective
To provide program participants a better understanding of how to process and underwrite VA Loans.
AND
How to navigate the VA Portal and utilize its resources to make the VA Home loan process easier.

4. VA Regional Loan Center
QUESTIONS CONTACT THE VA
Go to
Lender’s Handbook
CALL , or
The Lender’s Handbook is referenced throughout this presentation
Refer to Websites information on handouts

5. Where we are Today
Find A Home
Go to a lender
Close Days

6. Register in the VA Portal
Go to
Access VA Portal and Register
Must have a VA Lender ID
See handout for registration process

7. WHY A VA LOAN? No Down Payment for loans less than $417,000
No Mortgage Insurance Premium
Limitation on Buyer’s Closing Cost
No prepayment penalty
Servicing is available through the VA to avoid foreclosures. Check Portal for VALERI updates. Borrowers should contact lender first.

8. Obtain A Certificate of Eligibility
Complete VA Form
Access WEBLGY to get electronic COE (through the VA Portal) at or
Upload supporting documents , Forms , DD214 (member 4) and Statement of Service. Satisfaction of Mortgages, Recorded Deeds and HUD 1 will support restorations of entitlement
Mail the Certificate of Eligibility application to:
Atlanta Regional Loan Center Attn: COE (262)
PO BOX
Decatur, GA Toll Free
HTTPS//IRIS.VA.GOV
We ask that very effort be made to save the veteran from a last minute long distance tip to the RLC to get a COE.

9. ACE-Automated COE
Access Internet based application through the VA Portal
See Applications select WEBLGY, proceed to Eligibility, and Create a Record. Input information according to military service records data, i.e. Form DD214 . To avoid electronic errors, documents must be uploaded into (WEBLGY). See pg 15 handout
Maximum guaranty amount is now $104,250 or 25% of conforming loan limit for purchase up to $417,000
See Handout Pgs 15-21
If electronic application is attempted and the system does not generate a COE, the application can be electronically submitted to the COE Center, but you must also electronically upload the supporting documentation, DD214/ Statement of Service or your application will be returned incomplete.

10. Surviving Spouse COE
If applying for the first time submit form to:
Atlanta Regional Loan Center
Attn: COE (262)
PO BOX Decatur, GA
30031
Only paper applications accepted by mail. This process may be lengthy. Please submit immediately.
Chapter 2.3, M26-7

11. Restoration of Entitlement
When entitlement is used, it must be restored to obtain a 25% guaranty.
Complete VA Form and provide proof of service (upload all documents into WEBLGY)
AND
Provide proof of loan payoff and disposal of property, ie;
HUD 1
Recorded Satisfaction of Mortgage
Recorded copy of Deed
Release of Deed of Trust (Cancellation)
Chapter 2-3, M26-7

12. Formula for Entitlement
Basic Entitlement
Bonus Entitlement
A Veteran’s basic entitlement is $36,000
Loans greater than $144,000 the Maximum Guaranty amount is 25% of the loan amount, up to $104,250
See Handout Pg 33
Loan amount $417,000 X .25%= 104,250 Max Entitlement 104, = 68,250 Bonus Entitlement 68,250 X 4= $ 273,000 New Loan Amount $273,000

13. Verification of Benefits
The Veteran’s Exempt Status is now verified on the Certificate of Eligibility. Please refer to circular See Handout
Since FF status is shown on the COE, lenders in most cases will no longer be required to fax VA Form to VA for processing.
Do not send the form if the veteran does not indicate they receive service-connected disability benefits from VA Circular
See Handout Pgs

15. ORIGINATION PROCESS
Once you determine the borrower is an eligible Veteran and have obtained a COE/ACE, begin the application process.
Please Obtain COE/ACE and Verification of Benefits early-not the day of closing.

16. Eligible Loan Purposes
Purchase or construct a home
Refinance
IRRRL (streamline or rollover)
Cash-Out Refinance-(up to 100%
existing property value, must
occupy)
Install Energy-related features
True or false- A vet may use their benefit to purchase land only?
Chapter 3 Pgs. 3-5
Chapters 6-7

17. COE/ACE IS OBTAINED PROCEED TO:
Loan Processing
COE/ACE IS OBTAINED PROCEED TO:
Complete all required forms (CH 5)
Verify credit is satisfactory (CH 4)
Obtain appraisal & Notice of Value NOV (CH 13)
Obtain VOE’S and AUS-if used (CH 4)
Asset verification if needed (CH 4)
Obtain Veteran’s (if exempt) Status (COE)
Seller Concessions and allowable closing fees (CH 8) See Handout
Calculate funding fee (CH 8) (Circular )
Close the loan
Ch. 5 Procedures the Lender Must complete B4 receiving guaranty; How to submit loan docs to VA; Prior Approval Package submission Procedures (elaborate on philosophy); Automatically closed loan procedures, EDI
Ch. 4 is the Credit underwriting chapter. Information relating to Income, credit history, debts, and assets are included in this chapter. Completion of Form 6393, Loan Analysis, Ch. 4 full instructions.. Back bone of determining financial eligibility, Residuals and Debt to income ratios are explained in a simple to read chart.
Staff Appraisal Reviewer (SAR) under the Lender Appraisal process Program (LAPP) is authorized by VA to review the appraisal see CH13 explains the appraisal review process, preparing an NOV, Conditions and Reqmts of the NOV must be met, Changing the NOV
VOE/ AUS discussed later
Applicant needs sufficient cash to cover closing costs & points not included in loan, down payment, diff in sales price and NOV, price exceeds value. Only assets needed to close the loan must be verified.
No FF for exempt vets and un-remarried widows of service connected disabled vets
Seller Concessions (Ch8) do not include paying vets closing cost, points as appropriate to the market… eg. Interest rate is 7.5 % with 2 discount points. Seller could pay the 2 points, but if seller paid 5 points, 3 would be considered as seller concession. Seller concessions, in the extreme, may entice unqualified vets into unaffordable mortgages and may disguise the vets inability to qualify for the loan.
Calculation of FF is simple and electronically transmitted to VA through the Funding Fee Payment System. . Instruction are listed in Ch8
Close the loan. Back to Back closings. Vet has VA loan to be sold/closed on same day as the purchase of a new VA loan closes. Vet must complete and sign the 1880 application, and it should be attached to the 2 HUD Sett Stmnts, showing the selling and purchase of the two homes. The vets Ent wld be restored and used on the new purchase.

18. VA Required Documentation
CAIVRS
AUS (Automated underwriting Print out, Data Integrity).
Debts and obligations (Credit reports)
NOV Notice of Value/Appraisal
Loan Application URLA
Verified, available income, 2 years minimum
Occupancy
Assets
Adverse Data
(Credit)
Form Loan Analysis
Chapter 4, M26-7

19. Occupancy Requirement
The veteran borrower must intend to occupy the home as his/her primary residence
This must be indicated on VA Form at closing
The spouse is the “only” other person that can satisfy the occupancy requirement
Chapter 3, M26-7

20. Debts and Obligations
Significant Debts must be deducted from effective income to determine repayment ability. Form
1 full month of paystubs may reveal additional unreported debts such as alimony, garnishment, etc.
Analyzing Credit, Adverse data, supporting documents are required
Chapter 4, M26-7
Definition for significant debt.. Debts and obligations with 10 mos or more remaining. If less than 10 months with large payments that severely impact the family’s resources for any length of time.
Ch. 4 also covers alimony/child support obligation, pending sale of Real Estate, secondary borrowing, deferred student loan payments, loans secured by deposited funds

21. APPRAISALS
Order appraisals through VA Portal at
Select Webgly, Go into Loan- Request appraisal. Select Lapp for Automatic Lenders or IND if Prior approval. Indicate LGI if liquidation appraisals and Submit.
Complete application with correct information and submit. The system will generate a VA request for determination of reasonable value (form ) See Handout
Chapter 12-13, M26-7
Follow the prompts to register. If already registered, click into TAS, to obtain VA loan number, appraisal and Notice of Value
Appraisals are required to be
Provide both Uniform Residential Appraisal Report and NOV
To verify property meets minimum property requirements -chapter 10
All contingencies should cleared-provide required documentation only with full review package

22. Appraisal Requirements
Sales contract , must provide a complete copy to appraiser, failure to provide will hold assignment.
Title Study and Legal Description, lender must provide complete legal on the 1805
Burglar Bars – VA no longer offering waivers.
Release on at least one window per room or rapid egress
Wood destroying Insect info not required unless part of the property constructed of Wood
See C & V Manual

23. REFINANCING Refer to chapter 6 Check occupancy rules
Verify active VA Loan
Cash Out–up to 100% value, credit, appraisal and occupancy required.
IRRRL- No credit, No Appraisal required Chapter 6 M26-7
1.Discuss IRRRLs, -vet must certify that he/she PREVIOUSLY lived in home.
2. Cash out refi and new loans
amt of guaranty, extra entitlement, correct input to lgy (reduced guaranty)
3.Ch 3 occupancy rules– law requires vet obtaining a va loan to certify that he/she intends to live in the property
W/I a Reasonable time-60 days. If more than 60 days… a) there must be a specific date that vet will move in and b) a particular future event that will make the move possible. Past 12 months is not considered reasonable. Only the spouse can satisfy occ reqmt, in vets absence

24. Submitting Loan Package
WEBLGY is programmed to mark every 10th case for full review/audit as required in MP26-1
Provide full package to the RLC when WEBLGY shows “YES” in the top right corner (shows once the loan has been guaranteed)
If submitting package to VA for LGC (Loan Guaranty Certificate), provide documents required per Modified Submission Packages
IRRRL or Cash Out Refinance-refer to Chapter 6 and provide required documents
Chapter 5, M26-7 Pgs 1-23

25. Submitting loan package
Cash out refinance loans must have entitlement restored prior to obtaining LGC for the new loan. Only VA has the authority and ability to restore entitlement.
Entitlement needs to be restored in order to obtain 25% guaranty.
Chapter 5 M26-7 Pgs. 1-23

26. Allowable Fees and Charges
Pay VA Funding Fee (unless exempt). Circular
1% flat charge from lender
See Chart, Handout pg. 35
Chapter 8 M26-7
See Handout Pgs

27. VA Funding Fee
The basic funding fee for a first-time user is 1.40% of the loan amount as of November 18, 2011 (See Circular for changes)
The funding fee for Reserves/Guard is 1.65%
(Effective November 18, 2011)
For subsequent use, except for IRRRLS the funding fee is 2.8%
The funding fee for an IRRRL or an assumption is .50%
See Circular
Handout Pgs

28. Funding Fee System
The funding fee is paid electronically by the lender within 15 days of closing. FFPS requires a password to access. FFPS can be accessed at
The lender must obtain a Vendor ID number. Call Funding Fee Helpline at , or
All VA loans, including exempt cases must show a funding fee record in order to obtain a Guaranty.
See Handout Pg. 31

29. To Issue Automatic Guaranty LGC
A Loan Guaranty Certificate ( LGC) is obtained by automatic lenders thru the WEBLGY System.
Log into VA Portal Select Weblgy. Go into Loan, enter New Loan, select the Automatic option and submit all information required as per loan closing documents.
All data must coincide with Certificate of Eligibility, Property information and funding fee system. Next submit. Loan Guaranty Certificate will be generated in seconds.
See Handout Pg. 32

30. LENDER MAINTENANCE Lenders and agents must be approved by VA
Mergers and acquisitions are submitted to VA Central Office
Payment of fees is to defray costs
Yearly corporate company financial statements are required
Online training required for underwriters
Information, forms may be obtained on VA website
See Handout Pgs
Chapter 1 M26-7

31. Supervised lenders require VA approval
Supervised lenders require VA approval. However they are supervised by entities other than VA. Examples are Banks and Credit Unions.
VA Agents require a VA Lender ID number. Agents must be approved by a sponsor with Supervised or Non Supervised Automatic Authority. For Applications call
VA LENDERS
Prior Approval lenders also require a VA Lender ID Number. All packages must be submitted to VA for processing prior to closing the loan.
Chapter 1, Lenders Handbook

32. Notary Fees Puerto Rico
Refer to Serial letter issued July 17, 2010.
Puerto Rico Notarial Act Law 43 of July 23, Letter sets the maximum Abogado-Notary fees payable by veterans at closing of home purchases in Puerto Rico, Vieques and Culebra.
See handout or call

33. Thank You
Questions
Discussion