Avoiding Causes of VA Loan Denial in Utah

VA loans (backed by the US Department of Veterans Affairs) are some of the most beneficial mortgage types out there for those who qualify, offering no down payment requirements and fantastic mortgage rates to military veterans and their spouses. And while the qualification thresholds for VA loans are relaxed compared to many other loan types, this does not mean any such veteran or spouse will automatically be approved -- there are a few reasons why an underwriter may deny an application.

At Integrity First Lending, we're happy to assist clients throughout Utah with securing VA home loans, from initial application through your home search and eventual closing day. We work closely with you to ensure the highest chances of approval from an underwriter for your VA loan application. Here are some of the top reasons why an underwriter may reject your VA loan, plus how you can avoid these risks if you're applying soon.

Major Changes to Credit

While some small changes to your credit score may not have a big impact on your VA loan approval, if there have been any major changes in your credit history in the past year or so, this could be a red flag for an underwriter. Be prepared to show proof of why these changes occurred and how you plan to stay on top of your finances in the future.

For instance, if you defaulted on a loan in the past year, or if you had to declare bankruptcy, this could be grounds for an underwriter to deny your VA loan application.

Employment Change

Once you've begun the VA loan pre-approval and application process, it's important to stay in your current job. If you should happen to lose your job, or if there are any changes in your employment status, be sure to let your lender know as soon as possible.

An underwriter will want to see a consistent work history and proof of steady income before approving a VA loan, and a sudden change in employment could impact your approval.

Applicant Errors

In some other cases, mistakes made by the applicant on the VA loan application itself can lead to a denial. Double-checking your information and ensuring all fields are filled out correctly can help avoid this issue.

For instance, if you forget to list your current employer on the application, or if you omit information about your monthly debts, this can look like an attempt to hide something from the lender. And in turn, this can make it difficult for an underwriter to approve your VA loan.

Automated Underwriter Errors

Finally, some lenders today utilize automated underwriting systems as a part of the loan approval process. If there is an error on the automated underwriter's end, this could lead to your VA loan application being denied.

If you experience any of these issues when applying for a VA loan, don't hesitate to reach out to Integrity First Lending for help. Our mortgage experts are here to help, including with any errors that may be made on the part of an underwriter.

For more on how to avoid being rejected on your VA loan application, or to learn about any of our mortgage rates or home loan programs for Utah clients, speak to the pros at Integrity First Lending today.