DEPARTMENT OF VETERANS AFFAIRS REGIONAL OFFICE NORRIS COTTON FEDERAL BUILDING 275 CHESTNUT STREET MANCHESTER, NH 03101

					           In Reply Refer to:373/26
                						         LOCAL RELEASE 26-00-14






TO:	LENDERS ORIGINATING VA LOANS IN THE STATE OF NY


SUBJ:	MANCHESTER REGIONAL LOAN CENTER (RLC)
                     LOAN PROCESSING ISSUES




Our office would like to offer a belated welcome to those lenders processing VA loans for properties in 
New York.  We assumed responsiblity for the VA loan processing function for New York properties
effective January 1, 2000.  Please note that the VA appraisal function for properties in New York is still 
under the jurisdiction of the appropriate VA regional office in either New York City or Buffalo.


What is the purpose of this Local Release?


We would like to provide you with sources of information relative to processing VA loans, point out the
advantage of VA automatic underwriting authority, and offer some reminders about VA underwriting/loan
processing requirements.


Where can I obtain information about processing VA loans?

The main source of information about processing VA loans is contained in VA Pamphlet 26-7, VA
Lender's Handbook.  This document as well as other information concerning VA loan processing is
available at our Internet site http://homeloans.va.gov/l&s.htm.


VA offers satellite training courses on different aspects of loan origination throughout the year. Our
Local Release 26-00-08 announces the schedule of broadcasts for 2000 and who to contact if you wish 
to attend. This schedule is also posted on the VA Internet site listed above.


Our Veterans Service Centers provide general information about the home loan benefit and will mail
out the application for eligibility that must completed and sent to our Winston-Salem, NC Eligibility
Center.  Your local Veterans Service Center can be reached at (800) 827-1000.


If the loan underwriting pertains to a property in New York or New England, you may contact our
office by telephone (800) 827-6311 ext. 3314, e-mail nh_lp@vba.va.gov, or fax at (603) 666-7549.
Please remember that the VA offices in NYC and Buffalo still process appraisals for properties in the
state of NY.

What does VA "automatic" loan processing mean?


VA basically categorizes lenders into two groups: those with automatic underwriting authority and those 
without this authority.  Lenders that are supervised by federal agencies such as FDIC have the automatic
authority.  Non-supervised lenders must apply to VA for automatic authority.


What is the advantage of having the VA automatic authority?


In most cases lenders iwth automatic authority can process the appraisal and underwrite the loan much
faster.  VA automatic lenders do not have to send the underwriting package to VA except in cases where
there are joint borrowers who are not married, supplemental loans, loans to veterans receiving VA 
nonservice-connnected pension, veterans rated incompetent by VA, and interest rate reduction refinancing
loans in a default status.  If you would like to apply for automatic authority, please refer to website,
www.homeloans.va.gov/lenders for detailed application instructions.


If I do not have VA automatic authority or the loan is not eligible for automatic processing, what do I
need to submit to your office?


Exhibit A is a listing of required items for prior approval underwriting.  Please ensure required forms are
completed, signed, and the package is sent to our office (VARO, 275 Chestnut Street, Manchester, NH 
03101) if the property is in New York or New England.


Can agents or mortgage brokers submit a "prior approval" package to VA?


No, the prior approval package can only be submitted by a lender.  VA considers the firm that will fund the
loan to be the lender.  If the lender has automatic authority, they should not submit a loan to VA for prior
approval unless is is either not eligible for automatic processing (see exceptions above) or the package is
accompanied by a memorandum from the lender's underwriter explaining the reason it is being sent to VA.
You can find information about agent approval processing in the VA Lender's Handbook, VA Pamphlet 26-7, Section 1.08.


What if the lender's underwriter definitely indicates the loan should be denied, but the veteran wants
it sent to VA?


The loan should not be sent to VA.  The lender should fully disclose the reason the loan was disapproved
and that the veteran is free to apply to another lender of his or her choice.


What are some of the processing requirements VA would like to emphasize based on recent loan reviews?


Please see  Exhibit B, "Reminders Concerning VA Credit Standards and Processing Requirements".
We ask that appropriate staff be made aware of these "reminders" so that the loan decision can be made without delay.


Does VA Manchester have a Maintenance and Utility Chart for New York properties?


Exhibit C, "Maintenance and Utility Chart", is our current maintenance and utility chart for our entire area of jurisdiction.
This chart can be used as a guideline.  Lenders may use other figures with supporting documentation.


What is VA Manchester's policy for lender's requesting the status of a Loan Guaranty Certificate
(LGC)?


We ask that you limit inquiries to loans in New England and New York where you have not received either
an LGC or suspense letter to at least 30 days after you sent the closed loan package.  Please list all pertinent
information (e.g. VA loan number, veteran's name, date sent to VA, lender contact's name, address and 
phone number) and fax your inquiry to (603) 666-7549.


Does the VA office in Manchester offer lender training?


Yes, our office will send a Local Release in the near future regarding training.  The release will include a
questionnaire for those lenders interested in attending a loan originatino training session.


What if I have additional questions?


If you have additional questions, please contact our Loan Processing Staff at (603) 666-7502. 








A. A. Snyder
Loan Guaranty Officer




Exhibit A-Checklist for Initial Prior Approval Submissions
Exhibit B-Reminders Concerning VA Credit Standards and Processing Requirements
Exhibit C-Maintenance & Utility Chart