If a borrower has co-signed for someone else and the other person pays that debt, contact me first for ways to structure financing for their new home. We may not need to count that debt if we can prove the other party pays the debt responsibly.

Answer: VA does allow for debts to be ignored in certain cases. (See the guideline below.) Expect an underwriter to require at least a 12-month history of payments from the holder of the loan in order to consider ignoring the debt. Reference: VA Lenders Handbook Ch. 4, 5-d: Applicant as Co-obligor on Another’s Loan (04/10/09) […]

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