As with other forms of loans, the debt-to-income ratio of veteran seeking qualification for a VA loan is a major factor that is established by the Veterans Administration and used by the lender to determine if the borrower is capable of meeting all of the expenses associated with home ownership.
This ratio can be figured by adding the total mortgage payment (all elements of PITI) and adding them to all recurring monthly revolving and installment debt such as car loans and credit cards. This number is then divided by your gross monthly income. In order to qualify for a VA loan, your ratio must be at least 41%. For those borrowers whose number exceeds this percentage, the VA has different guidelines that govern what it calls residual income.
There are other factors can also help to determine whether you will be able to qualify for a VA loan. Some of compensating factors include good credit history, limited use of consumer credit sources, minimal consumer debt, long-term employment, military benefits, liquid assets, etc.
