Tag: Charge Off

VA Charge Off Requirements

Question: We are trying to do a rapid rescore on a VA loan.  The feedback is that we should have them pay off a charged off account.  I thought VA did not require a charge off to be paid. Answer: Charge offs are not considered in the DTI calculation on a VA loan. VA only […]

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Charge-Off – Auto Loan

Question: Is a charge-off auto loan required to be paid off prior to closing for an FHA loan? The credit report shows the auto loan in the collection section of the credit report, but the debt clearly states, “charge off”. MC Chart – Collections & Judgments Answer: I understand your confusion, but since the debt […]

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Payoff Requirements for Charge-Offs

Question: What are the requirements when a client has a charge-off?  When does it need to be paid off and when does it not need to be paid off?  MC Chart – Collections and Judgments – All Agency Guidance Answer: Following is the information you will need from Fannie Mae. Reference: Fannie Mae Guide B3-6-07 […]

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FHA Requirements for “Charged-Off” Accounts

Question: My client has a charge-off from several years ago.  Is this required to be paid off prior to closing? Answer: No.  A charged-off account would not need to be paid off unless it reappeared as an active collection, and then it would depend on the circumstances.  See the full guideline below. Reference: FHA Handbook […]

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VA and Charge-Off Accounts

Question: The credit report shows a charge-off, but we have an approve/eligible through DU. What do we need to do with the charge-off? Answer: A charge off is not considered an active debt, even though that previous data is still showing in the account detail on the credit report. The creditor is now reporting the […]

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