n. Certificate of Commitment

For joint loans involving one or more nonveterans

·   the loan amount shown on the commitment is limited to the veteran’s portion of the loan, and

·   the percent of guaranty is based on the ratio of the amount of entitlement the veteran has available to the veteran’s portion of the loan.

VA will issue the Certificate of Commitment with a reminder that

·   no part of the guaranty applies to the portion of the loan allocated to the nonveteran, and

·   in the event of foreclosure where a loss is sustained, the holder must absorb any loss attributable to the nonveteran’s portion of the loan.

o. Loan Guaranty Certificate

The “Amount of Loan” reflects only the veteran’s portion of the loan.

If more than one veteran used entitlement on the loan, it will reflect the total of all portions allocable to those veterans.

For veteran/nonveteran joint loans, the LGC will contain the statement,

“the amount of guaranty on this loan is limited to the veteran’s portion of the loan.” 

The lender must satisfy itself that the requirements of its investor or the secondary market can be met with this limited guaranty.

Whereas the whole loan amount will appear on the mortgage security documents; that is, mortgage note or deed of trust, only the veteran’s portion is shown on the Certificate of Commitment and the Loan Guaranty Certificate.