This includes the mortgage and escrows, of course, as well as whatever student loans, car payments, credit card bills and whatever other obligations exist. Residual income is the monthly household income which remains after a homeowner has made monthly payments to on all of his credit accounts.

The Department of Veterans Affairs requirement for вЂњresidual incomeвЂќ is a big reason why. However, despite few VA borrowers having вЂњskin in the gameвЂќ, VA mortgages default at the lowest rate of all major lending options - including prime loans made via Fannie Mae and Freddie Mac. ItвЂ™s among the programвЂ™s most popular features. Residual Income : Helping VA Borrowers Avoid Foreclosure The key is a common sense guideline known as вЂњresidual incomeвЂќ. Unlike other 100% financing programs, though, VA loans default at a very low rate. One such вЂњzero-downвЂќ program is the from the Department of Veterans Affairs.ДЄvailable to veterans and members of the military, VA home loans give military buyers the ability to finance 100% of a home at low VA mortgage rates. ItвЂ™s also because of low- and no-downpayment mortgage programs.

This is, in part, because the homeownership costs are lower than rental expenses in many U.S. The housing market is rebuilding with first-time buyers playing an outsized role in its rebirth. Low Foreclosure Rates For VA-Backed Loans In order to get mortgage-approved, the Department of Veterans Affairs requires VA mortgage applicants to show a minimum VA residual income based on their geography and household size.

VA residual income is the discretionary income which remains after a homeowner has fulfilled all of its monthly credit obligations.

Residual income definition