Offering VA Home Loans Through Your Credit Union

Your credit union can also offer VA home loans to members by becoming approved through the VA.

If you provide VA home loans, you know what a valuable product it is to provide to your members. Its special terms are reason enough to entice borrowers, but for credit unions offering this product it’s more than just more loans for the books.  It’s a way to provide for the men and women that have graciously served our country and it’s because of this dedication to the people that it’s worth understanding how you can provide this product.

There are a couple ways your credit union can offer VA home loans. One option is to receive approval through a lender who is already authorized as a non-supervised lender.  This process is the simplest option for the credit union and requires few steps to offer VA loans.  This requires your credit union to:

  • Draft a letter to the VA requesting approval.
  • Pay a $100 annual fee to the VA.

This option is much less complicated and helps your credit union offer VA loans much quicker. It basically is an approval stating to the VA that the approved non-supervised lender will review the loan and sign-off on it.

Another option would be to go through the process to become a non-supervised lender to close loans automatically. This requires:

  • Submission of the required application.
  • Experience in originating and processing VA loans with proper documentation and submission.
  • Nomination and recommendation of your Underwriter who has experience and familiarity with VA home loans.
  • Minimum of $50,000 working capital or minimum of $250,000 adjusted net worth.
  • One or more unrestricted lines of credit totaling at least $1 million
  • If the credit union customarily sells loans it originates, it must have a minimum of 2 permanent investors.
  • Implement a written quality control plan which ensures compliance with VA requirements and meets criteria outlined in the VA Lenders Handbook.
  • Must have one qualified employee and alternate to be the primary liaison with the VA.

As you can see, while these steps are doable, they are extensive for any lender. These two options are available for any credit union and the first option we discussed is available through any VA non-supervised lender.

Further information about becoming a VA lender is found on their website.

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