c. Documentation Guidelines For Credit History (continued)

Subject and Reference

Documentation Classification

Verification of significant nonmortgage debt (section 5 of this chapter)

Obtain direct verification for significant debts not reported on the credit report.

Note:  Significant means that the debt has a monthly payment exceeding 2% of the stable monthly income for all borrowers.

Same as Refer.

Note:  Perform manual downgrade to Refer if direct verification reveals more than 1x30 day late payment in the past 12 months for any of the omitted debts.

Mortgage payment history (section 7 of this chapter)

Obtain direct verification when ratings are not available on mortgages that are any of the following:

·   Outstanding

·   Assumed

·   Recently retired

A written explanation of mortgage payment history is required for borrowers with more than 1x30 day late payment for all mortgages for the past 12 months.

Perform manual downgrade to Refer for any mortgage debt with more than 1x30 day late payment in the past 12 months.

Account balances (section 7 of this chapter)

If a mortgage or other significant debt is listed on the credit report as past due and was last updated >90 days, verify current status of past due debt. 

Same as Refer, however if rating is currently >90 days past due, manually downgrade to REFER.

Derogatory credit information (section 7 of  this chapter)

Obtain explanation for derogatory credit.  Explain assessment of creditworthiness on VA Form 26-6393, Loan Analysis.

No determination of ratios or credit worthiness is required.

Alimony and/or child support payments (section 2 of this chapter)

Provide the following:

·   Proof of deposits on bank statements for 3 months

·   Front page and details of support payments from the divorce decree, indicating evidence of at least 3 years continuance.

Same as Refer.