b. Verification Requirement (continued)

For prior approval loans, this means the date of the deposit verification is within 120 days of the date the application is received by VA (180 days for new construction).

c. Pending Sale of Real Estate

In some cases, the determination that the income and/or assets of a veteran are sufficient to qualify for the loan depends upon the consummation of the sale of presently owned real property. 

·   Sales proceeds may be necessary to make a down payment or pay closing costs on the VA loan. 

·   In addition, the lender may want to consider the amount of equity the applicant has accumulated in the property and the extent to which that equity is attributable to the applicant’s investment rather than the housing market, in evaluating the applicant’s ability to manage assets.

The lender may consider any down payment or costs on the VA loan as provided for by the sale of the property if available information provides a reasonable basis for concluding the equity to be realized from the sale will be sufficient for this purpose. 

References: 

·   See section 4 of chapter 5 for prior approval loans which depend upon the sale of property for the borrower to qualify.

·   See section 6 of chapter 5 for required loan closing documents.