DocMagic is adding a new form that will be included in standard packages for West Virginia, in certain situations. West Virginia requires that a lender document their ability-to-repay analysis that confirms the borrower does have an ability to repay, when the calculated Debt-to-Income (“DTI”) ratio is over 50%. The assessment must consider the borrower’s ability to repay while considering all current debt obligations, the term of the loan, and the particular circumstances of the borrower(s), including both their current asset and debt obligations as well as any expected changes to their circumstances in the future.
The new West Virginia Ability to Repay Worksheet (Form ID: WVARW.MSC) is setup to identify any mitigating factors that may cause a lender to approve a borrower with a high DTI of more than 50%. The options include consideration of various current and future factors. Combined with the documentation in the file, the worksheet establishes a basis for the lender to have determined the borrower had an ability to repay the subject transaction.
The worksheet must be signed by both the borrower and a representative of the lender. DocMagic will trigger the worksheet in the Closing package when we calculate the borrower’s DTI over 50%, as well as make the form available in the Forms List to be selected as needed by a lender.
The form will be added to the West Virginia state build and matrix as of November 9, 2023. Should you have any questions, please contact the DocMagic Compliance department.
