If you are active-duty military, a veteran or a surviving military spouse, you may be eligible to get a VA home loan. The VA’s home loan program is … Read More
There are several benefits program under the VA loan program. First, there are loans to help eligible veterans or surviving spouses purchase a home. … Read More
To be eligible for a VA home loan, the veteran must meet certain requirements. To purchase or cash out refinance, the money must be used for a home in … Read More
Get Your VA Approved
The VA loan entitlement program, originally passed in 1944 as the Servicemen’s Readjustment Act, was intended to help returning service members obtain a mortgage to purchase a home. It has expanded to include a wider range of veterans, including National Guard members and Reservists.
VA Loan Entitlement
VA loans are not made by the federal government. Rather, the government guarantees a financial institution that a specific amount of the loan will be repaid if the loan goes into default. As with any mortgage, it’s prudent to shop for the best rates and terms.
The applicant may opt out of paying points and other closing costs on a VA loan but this must be negotiated with the buyer, the seller, and the lender. Although applicants may be required to pay a funding fee, they will have the option of including this in the loan if they prefer. Some veterans will not have to pay a funding fee if they:
- Have a service-connected disability and are receiving a stipend for it.
- Have a service-connected disability but are active duty or retired.
- Are a surviving spouse.
- Currently, those who have served from WWII to the present are eligible for a VA loan entitlement. Service need not have been in a war zone but there are minimum length-of-service requirements and the discharge must have been other than dishonorable.
- Surviving spouses who have not remarried are eligible if the veteran was killed in action or died from injuries sustained in service.
- Surviving spouses over 57 years old can be remarried.
- Surviving spouses of 100 percent disabled veterans can be eligible.
- Veterans or surviving spouses must have credit and income sufficient to qualify for the loan.
- The VA loan must be for a primary residence, not a rental or second home.
How to Determine Eligibility
To apply for a VA loan, the applicant will need a Certificate of Eligibility, or COE, from the Department of Veterans Affairs. This can be done online or through the lender. The veteran or applicant will need a copy of the DD-214 for both online and in-person requests. Additional information may be required for surviving spouses, and specifics can be obtained at the Department of Veterans Affairs website.
Reusing VA Entitlement
Under certain circumstances, a veteran’s VA loan entitlement can be used more than once. To do this, the first VA loan must have been paid in full. Borrowers can apply to use their eligibility to purchase another home as long as the first loan was satisfied and the borrower intends to use the new home as a primary residence.
Veterans or surviving spouses who didn’t use their entire entitlement and have a balance remaining can use that balance on another home.
If the VA has no proof of the disposition of a home, they may not allow restoration of the entitlement even if they have proof that the previous loan was paid off.
Additional information on all of the above can be found at the Department of Veterans Affairs by clicking on the menu to the left.
Many people will be looking for a new home within the next year. However, when buying a new home, you will probably need to obtain a loan to finance the purchase. One type of home loan that is available is a VA loan. There are numerous VA loan advantages in 2017.
VA Loan Advantages
What is a VA Loan?
Veterans Affairs mortgages, known as the VA, are becoming increasingly more popular. These loans are offered to people who are actively serving in the military or individuals who are military veterans. The mortgage is backed by the United States government and they are funded by private lenders. Now is a very good time to buy a home or refinance an existing mortgage with a VA loan.
Eligibility for a VA Loan
One of the advantages of VA home loans in 2017 is that the requirements are more lenient than with other types of home loans. ***The VA looks at the big picture not just your credit score. And, although there is no established minimum score requirement, lenders do like for you to have a credit score of at least 620. Another benefit is that mortgage insurance is not required. For qualification purposes, you must be a member of the US military, a veteran, a reservist, or a member of the National Guard. If you are a spouse of a service member who lost his or her life while on active duty, you might also be eligible. You will need to provide proof that you can repay the loan. The loan must be used on your primary residence; it cannot be used to finance a vacation home.
VA Loan Advantages
A major advantage of a VA home loan in 2017 is that you are not required to make a down payment. This can save you money. Most other types of loans require a 20% down payment. In addition to no down payment, you can qualify for the loan even if bankruptcy is in your history. VA loans will offer you the most competitive interest rates in the market and, because it is backed by the VA, the loan is less risky for lenders. You can also pay off the mortgage at any time without a prepayment penalty.
Another big advantage of a VA home loan in 2017 is that there are limits on closing costs. Some of the fees must be paid by other parties. Furthermore, the costs that you are required to pay can be rolled into the loan, so you do not need to bring any money with you at the closing. You are not required to repay the loan in full to be able to obtain another VA loan.
The year 2017 will be a great year in the mortgage industry. You can apply for a VA loan confident that your mortgage will have the benefits you deserve. You can then enjoy the privileges that come with home ownership.
Facts About VA Loan Eligibility
For new homebuyers, one of the most arduous processes can be figuring out how to pay for their new house. There are many options for loans but how do you know which one is right for you? If you’re a United States veteran, a loan through the Department of Veterans Affairs is the best choice for a home loan you can make, as it is specifically designed for you and in most circumstances, requires no down payment. One can apply for a VA Loan eligibility with any lender that has a program for VA home loan.
Barring a few special circumstances (discharge due to hardship, service-connected disability, surviving spouses of veterans), VA loans are for veterans, military personnel currently on active duty National Guard & Selected Reserve members. The VA website offers minimum service requirements and qualifying dates for each status. Once that has been established, and you have found a home you desire to purchase, you will need to apply for a VA Loan Eligibility certificate.
Once approved, speak with a lender at a financial institution such as a bank or mortgage company.
Though VA loans are meant for military personnel, that doesn’t mean you are automatically entitled to one. Just like any other loan, you will be approved or declined based on your current financial status. Factors such as a bad credit rating or a previous bankruptcy will hurt your chances for approval.
If you filed for bankruptcy, that doesn’t mean you have completely forfeited your chance of being eligible for a VA home loan.
There are several circumstances that could have it disregarded. For instance, if your bankruptcy was discharged over two years ago, or if you have brought your credit back up to an acceptable rating and the circumstances that lead to the bankruptcy were out of your control, such as medical bills and/or being out of work. If your bankruptcy filing was discharged in the last year, then it is best to wait for another year or so. Otherwise, your lender is more likely than not to decline you.
If you are applying for a VA home loan for a second time and are not making a down payment on your home, your funding fee will be higher, by a bit.
The reason being that the reduced fee is more intended for first-time buyers and the time in between purchasing your first and second time should be adequate to save for the funding fee. If you are making a down payment, this can be reduced based on the percentage of said down payment. VA home loans are an excellent choice for veterans in good financial standing looking for a home.
Common Myths VA Loans
VA loans are among the best benefits that military personnel enjoy. This program not only offers one of the most flexible guidelines in the home loan market, but also promises 100% financing as well as refinancing of the mortgage. Sadly enough, not all veterans are fully aware of all the benefits of this program and this knowledge gap keeps them from making the best financial decisions. The VA loan program has evolved a lot over the years, but it is not difficult to understand. So, here is the first step towards ‘un-complicating’ this amazing financial product. These are the most common myths VA loans. Let’s get debunking.
1. It is a one-time loan
No, VA loan is not a one-time benefit. A veteran can benefit from a VA loan multiple times in their lifetime, as long as they fulfill all the necessary requirements laid down for accessing the loan. There is no limit as to how many times a veteran can use their VA loan.
2. VA loans offers small amounts that can fund only small homes
This common myths VA Loans is absolutely not true. The amount disbursed under a VA loan can vary from applicant to applicant, depending on their unique case. The loan amount can be as much as $1,000,000. That money can buy a pretty big home. Moreover, VA can be used for refinancing as well. This amount can reach 100% of the home value in many cases. So, the loan can not only be used to buy a house, but to refinance a loan as well.
3. It is a Government program. The process is slow and the requirements are more stringent.
This is quite the opposite of what VA loans actually are. This loan product has been designed for the veterans and its primary aim is to make it easier for them to take advantage of it. It is actually easier for a veteran to get a VA loan. In fact, the Veterans Association of Real Estate Professionals (VAREP) maintain that these loans actually take less time to close than the traditional loans by as much as two days.
4. Vets serving overseas cannot apply for a VA home loan until they return
Men and women serving the country overseas can most definitely apply for the loan. The condition is that either their spouse should be able to occupy the property while they are away or they have plans to return to the country within a year of applying for the loan.
5. Active service men, National or Reserve Guard and widow/widowers are not eligible for a VA loan
Any applicant falling in any of these three categories is 100% eligible for a VA loan. National or Reserve guard need a 6-year service record to become eligible. Widows and widowers of military personnel who lost their lives during active duty or died due to a service related injury are also eligible for the program.
If you are a Veteran looking to buy a house, you need to understand the VA Loan application process. You will need to get a Certificate of Eligibility (COE) from the VA to prove to the lender that you qualify for the loan. To get the Certificate, fill out a VA Form 26-1880. You submit the form along with proof of military service to the Winston-Salem Eligibility Center. Some lenders can get this Certificate for you, if there is adequate data in the VA records.
If you are discharged from active duty, get a copy of DD Form 214, Certificate of Release or Discharge from active duty. Include this with your VA Form 26-1880. If your discharge was after October 1, 1979, DD Form 214 copy 4 should be included.
Those who served in Selected Reserves or the National Guard need to show at least six years of service. For Army or Air Force National Guard, submit NGB Form 22 or NGB Form 23.
You can get your eligibility for a VA Home Loan restored if you have had a VA loan before and it is paid off and you are going to sell the first home. The unmarried spouses of a deceased veteran who died on active duty or as the result of active duty is eligible for the VA Home Loan. You need to contact the Winston-Salem Eligibility Center.
The next thing you need to do is consider how much you can afford to pay each month on a mortgage. It is best to guess too low than too high. This will keep you out of trouble down the road. Take a look at your credit report. If anything is incorrect, get it corrected before you apply for the mortgage.
It is reported that nine out of 10 VA Mortgages require no down payment. However, you will need money for the earnest deposit and appraisal fees. You will normally get these back when you close on your home.
Before going in to apply for the mortgage, understand that you will have to show some residual income each month. It is a very important aspect of getting the loan approved. Residual income is the money left over after you pay your mortgage and household expenses for other things, like food, gas, etc. If you don’t have enough residual income on your first go around, reduce your mortgage amount before you apply.
You cannot borrow extra money for upgrading your new home. You can only get the selling price or the appraised price, whichever is smaller. If you want to do upgrades, you will have to pay for them yourself. It is best not to go through job changes or make other large purchases during the mortgage application process.