m. Recently Activated Reservists or Guard (continued)

Example, if an activated reserve/guard member applies for a loan, they may present orders indicating their tour of duty is not to exceed 12 months.  Under these circumstances lenders need to carefully evaluate both the present income (current employment) and expected income(reservist income) in terms of income stability and reliability.

There are no clear-cut procedures that can be applied to all cases.  Evaluate all aspects of each individual case, including credit history, accumulation of assets, overall employment history, etc… and make the best decision for each loan regarding the use of income in qualifying for the loan. 

It is very important that loan files be carefully and thoroughly DOCUMENTED, including any reasons for using or not using reservist income in these situations. 

Weigh the desire to provide a veteran their benefit with the responsibility to ensure the veteran will not be placed in a position of financial hardship.

Lenders should contact the appropriate VA office if any questions arise regarding unusual circumstances regarding a mobilized servicemember’s income.

n. Income of Recently Discharged Veterans

Verification

Obtain verification of any of the following which apply:

·   Employment income

Reference:  See “Income from Non-Military Employment” in this section for verification requirements

·   retirement income, and

·   military separation payments.

If the applicant has been employed in a position for only a short time, obtain a statement from the employer that the applicant is performing the duties of the job satisfactorily and the probability of continued employment is favorable.