source:
  type: guide
  id: va-m26-7-ch01-t13
  authority: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 1, Topic 13 — Calculation
    of Adjusted Net Worth
  description: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 1, Topic 13 — Calculation
    of Adjusted Net Worth.
  coverage_tier: operative
obligations:
- id: va-m26-7-ch01-t13-full
  canonical_id: va-m26-7-ch01-t13-full
  section: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 1, Topic 13 — Calculation
    of Adjusted Net Worth
  type: do
  tags:
  - regulator-direct
  - va
  - va-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 1, Topic 13 — Calculation
      of Adjusted Net Worth
    source_class: va-handbook
    source_url: https://www.benefits.va.gov/warms/pam26_7.asp
    snapshot_id: b4bc25cdd49513a7
    fetched_at: '2026-05-23T01:53:52Z'
    content_hash: sha256:2516e061c3a90ce65e72b43ae4022a97e784d65ec7580998c523b5dc69ba6520
    paragraph_quote: '13. Calculation of Adjusted Net Worth Change Date February 1,
      2019 • This chapter has been revised in its entirety. a. Method Net worth for
      VA purposes is determined by 38 C.F.R. §36.4352(b)(4)(ii). b. CPA Requirement
      Adjusted net worth must be calculated by a CPA using an audited and certified
      balance sheet from the lender’s latest financial statement, per the above regulation.
      c. Calculation Adjusted net worth is total assets, minus total liabilities,
      minus the following unacceptable assets: • Any assets of the lender pledged
      to secure obligations of another person or entity. • Any asset due from either
      officers or stockholders of the lender or related entities, in which the lender’s
      officers or stockholders have a personal interest, unrelated to their position
      as an officer or stockholder. Personal interest indicates a relationship between
      the lender and a person or entity in which that specified person has a financial
      interest in or is employed in a management position by the lender. • Any investment
      in related entities in which the lender’s officers or stockholders (or their
      family members) have a personal interest unrelated to their position as an officer
      or stockholder. • That portion of an investment in joint ventures, subsidiaries,
      affiliates and/or other related entities, which is carried at a value greater
      than equity, as adjusted (“equity, as adjusted” means the book value of the
      related entity reduced by the amount of unacceptable assets carried by the related
      entity). • All intangibles, such as goodwill, covenants not to compete, franchisee
      fees, organization costs, and so on, except unamortized servicing costs carried
      at a value established by an arm’s-length transaction and presented in accordance
      with generally-accepted accounting principles. • That portion of an asset not
      readily marketable and for which appraised values are very subjective carried
      at a value in excess of a substantially discounted appraised value. Assets such
      as antiques, art work, and gemstones are subject to this provision and should
      be carried at the lower of cost or market. • Any asset that is principally used
      for the personal enjoyment of an officer or stockholder and not for normal business
      purposes. VA Pamphlet 26-7, Revised Chapter 1: Lender Approval Guidelines 1-41'
  judgment: false
