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The VA may be of the opinion that it is not written in stone, however; the first line under income from non-military employment reads “Verify a minimum of 2 years employment.” In practice, not having a full two years of documented employment in a loan file generally results in an uninsured loan. This is not information that is readily available to the public or contained in guidance for VA loan applicants. Establishing that a consumer was aware of this information would be very difficult. The clause that the seller is using to hold your deposit states that “Buyer will be in default if buyer furnishes false information to anyone concerning buyers financial and/or employment status”. If you have Realtors involved, this could easily be solved at the broker level. The seller would have no way of proving that accusation, and the selling broker should return your deposit. If they stick to their position, your next step would be the state real estate commission. If this is a for sale by owner transaction, you should file suit against the seller in small claims court. The burden of proof would be on the seller to establish that you had knowledge of the lender’s VA guideline and you materially misrepresented your employment situation to the lender.
The primary focus is your Real Estate Agent. They should be fighting to get your earnest money back under the terms of the contract. The speculation by the seller on what you knew and didn’t know is irrelevant. If you know that was the requirment you wouldn’t have given them your earnest money. Lean on your agent to enforce your rights under the contract.
I have been denied based on not having 2 consecutive years of employment and failure to show income for 2010. To my understanding from talking to the VA this rule is not written in stone. There are exceptions to the rule but is left to the discretion of the lenders underwriter. I am now trying to get back my deposit but all parties are making this very difficult. I have signed the denial letter which is in-line with the contingency on the agreement for a VA Loan. The Seller refused to return my deposit saying that I knew the VA requirement was 2 years and that I provided false information to the lender. How would they know this information? What can I do to get my deposit back without having to pay an attorney?
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