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
Buying a home tends to be a daunting process, but it can be easier if you know how the process works and which benefits are applicable to you. If you’re currently in or have been in the military in the past you may qualify for a VA home loan. These types of loans are guaranteed by the Department of Veterans Affairs (VA). They offer military benefits that the other home buying programs don’t.
Military Benefits of a VA Loan
One of the primary benefits of a VA loan is that it makes it easier to purchase a home. They require a very low or no down payment. This eases the burden of the initial costs of buying a home. Another one of the benefits is that since the VA is guaranteeing parts of the loan you’re not required to carry private mortgage insurance (PMI), which can significantly reduce your monthly payment. PMI ranges from .5 to 1 percent of the total loan. A $100,000 loan with a one percent PMI payment adds an additional $83 to the monthly payment. This could be the difference on whether you can afford to buy the home you’ve had your eye on. VA loans also offer a more streamlined and simple application process to get the process going faster.
You must qualify for the military benefits available through the VA home loan program. You can be retired from the armed forces with at least 90 days of service during a war. Or 181 days during peace times or six years in either the National Guard or Army Reserves or currently in the military with an active duty status. Spouses of service members who passed away due to a disability related to serving or those who died in the line of duty are also eligible for the program. You’ll also need to obtain a certificate of eligibility from the Department of Veteran’s Affairs. This is a process the mortgage originator can guide you on.
The VA has certain requirements about the residence you intend to buy to take advantage of the military benefits. You can use the funds from the loan to purchase a home, build a home or buy a condo if the project is approved by the VA. You can also purchase a fixer-upper and implement energy-saving technology to improve the overall home. Perhaps, you also can buy a manufactured home with a lot. The loan options give you flexibility in finding the home that you want.
Buying a home may be easier than you anticipated, but is easier with help from the VA. Take advantage of the program if you’re eligible and get into the home you’ve been keeping your eye on.
A VA loan is one of the main benefits military veterans can obtain when preparing to purchase a home. A VA loan allows you to purchase a home without a down payment. If you want to have a better understanding of these loans, below are a few important VA loan information you may find helpful.
VA LOAN INFORMATION
What forms of documents do I need if I was discharged a few years ago?
Each person applying for a VA Loan will need to obtain a Certificate of Eligibility with the use of a VA Form 26-1880. The form will require that you use a copy of your DD-214 to prove your service. The loan application will also need your savings, credit, and employment information.
Are Reservists eligible for a VA loan?
Members who have served in the Selected Reserves or National Guard for at least six years are eligible for a VA loan. Men and women who have served less than six years, if they’ve been discharged due to a disability that is related to their service, are also eligible. Those who were activated on or after the date of August 2, 1990, and were discharged or served 90 days, are also eligible for a VA loan.
Can I build a home with a VA loan?
Veterans can build their own home with the use of a VA loan. However, it can be a complicated process to get approved due to various clauses that are in effect. If you’re looking for more FAQs on this topic, you may be able to get a private home construction loan if you negotiate in good faith with the VA Certificate of Eligibility. You can then refinance the completed home with your VA home loan.
How can I find out more about inventory of VA foreclosed homes?
VA guaranteed loans are often obtained by The Department of Veterans Affairs and are often marketed through Ocwen Federal Bank FSB, West Palm Beach, Florida, which is a property management company. If you’re interested in purchasing a foreclosure, you can visit the company’s website online to obtain a list of properties that are available in the local area.
Can I buy a home if I’ve already taken advantage of the VA loan before?
One of the most commonly asked questions for those who are looking for VA loan information is if they can purchase a second property if they’ve already used a VA loan in the past. Your entitlement will need to be restored. This requires you to first pay off your previous VA loan. Your entitlement may also be restored if you no longer own the previous home. You’ll be able to reuse the loan for each home purchase that you make in the future.
Does the entitlement ever expire?
Your entitlement never expires and can be used immediately if you’re on active duty. When you are released from active duty or are discharged then a new determination of disability will be made.
Many military veterans are unsure whether they can use their VA loan entitlement for home improvements. According to the Veterans Administration, veterans who qualify for the VA Home Loan Guarantee Program can finance certain energy-efficient improvements.
Costs of the improvements may be rolled into their new home loans. The VA does, however, have some restrictions in place. One is regarding the types of improvements. Another is the amount that can be borrowed to complete those improvements.
Energy-Efficient Home Improvements
The VA will allow veterans to finance certain energy-efficient improvements so long as they use the money for those improvements. Here is a short list of energy-efficient improvements veterans are allowed to complete by rolling the costs into their new home loan:
• Solar heating and cooling installation
• Storm door and window installation
• Installing energy-efficient insulation
• Purchasing an energy-efficient furnace
• Any energy-efficient improvements that lower the cost of utilities
Veterans can borrow an additional $6,000 on top of the financing needed to purchase a home to complete energy-efficient home improvements without the need for a separate appraisal. For any improvements that are $3,000 or less, the VA does not require any additional documentation except for the receipts for the improvements.
VA Construction Loans
The VA does offer construction loan programs. These allow veterans to acquire and rehab a home or to construct a new home. Applying for a construction loan is the same as applying for any other VA home loan program. However, many lenders in today’s mortgage market are unwilling to approve construction loans. Although a veterans’ VA loan entitlement guarantees the VA will back the home loan, the lender still must approve the loan. Many veterans are unaware the VA does not provide the actual financing but provides insurance to lenders in the event borrowers default on their mortgages.
VA Home Equity Loans/Cash-Out Refinances
The VA allows veterans who have first liens on their homes to apply for home equity loans or cash-out refinances. If lenders approve the loan, the money can be used for home improvements. Veterans must have first liens on their homes and do not qualify for cash-out refinances if they own their homes outright. According to the VA’s Lender’s Handbook, a veteran may use their VA loan entitlement to refinance any first lien secured against the property, including conventional mortgages. Any loan proceeds beyond the total needed to pay off the first lien may be used by the borrower for any purpose acceptable by the lender.
But what happens when a veteran and his or her spouse divorce but still have a VA loan? This is where good information proves immensely helpful.
A Veterans Administration loan is more commonly known as a VA loan. It is provided as a benefit to veterans of the United States Armed Forces.
Veterans and their spouses may take out a VA loan but the veteran must be listed first on the loan and must be listed first on the title to the home. Only their respective spouse may be on the loan or share title with the veteran. No parent, significant other, fiancée, or anyone other than the spouse is eligible.
Divorce – Who Keeps the VA Loan?
In the event that a veteran and his or her spouse dissolve their marriage, the party awarded the home is typically also awarded the debt associated with it. Sometimes the divorce decree requires that person to refinance the loan and title to the home into his or her own name. If the veteran is the person awarded the home, he or she can obtain a VA refinance through his or her lender. A copy of the decree must be provided so that the ex-spouse can be removed from the title. The ex-spouse will have a document or two that requires signing. This differs from state-to-state.
Purchasing Another Home
One question lenders are often asked is “Can I purchase another house utilizing my VA benefit if my ex-spouse kept the house and the VA loan associated with it?” It depends on how much of your entitlement remains from the first VA loan. But the VA does allow two VA loans at the same time. This is known as second-tier entitlement. So long as the veteran’s maximum entitlement is not exceeded with the first loan, the veteran may be able to use VA financing to purchase another home.
Restoring VA Loan Entitlement
If the veteran and ex-spouse sell the marital home, pay off the VA loan, or refinance to a non-VA loan, restoration of the entitlement should happen right away. Then when he or she wants to purchase another home by re-utilizing their VA benefit, they can work with their current lender to make sure the restoration is in place so the veteran can finance their new home.
You have served the country and now it is time to put some of those hard-earned benefits to good use. One way the government has set out to help veterans is with respect to home ownership or purchase land using VA loan.
A VA loan is a great way to find the capital needed to get into a home that will provide for the safety and security of your family for years to come. However, these loans come with certain stipulations that must be met before the money can be used.
Many people rightfully question if the loan can be used for the purchase of land itself. There is good news on this front. But, once again, certain conditions must be met. This post will address those issues.
Is It Possible to Purchase Land Using VA Loan?
It Comes Down to the House
If you are looking to use this type of a loan to buy land, you will need to show that you have plans to build a house on it right away. That is pretty much the only major stipulation on the deal.
However, keep in mind that all the other guidelines governing this program still exist as well. It is true that most veterans use the program to purchase an existing stand-alone single-family house or condominium. There is much more flexibility built into this type of mortgage.
First, secure a firm contract to build a home on an existing piece of land. Then work with a VA lender to include the purchase of the entire property into the deal.
Purchase Land Using VA Loan: Eligibility Requirements
To become eligible for a VA loan, a veteran personally must occupy the home for a certain length of time. This precludes you from purchasing a home specifically for rental purposes. However, it does not mean a home must be finished at the time the loan is closed.
VA rules stipulate that you can buy land and then proceed to build the home on it. You’ll want to pay careful attention at this point The following types of homes and construction types will qualify under the program:
- Newly Constructed Homes
- Pre-Fabricated Homes
- Mobile Homes Under Certain Situations
If you do wish to place a mobile home on your purchase land, it is important to keep in mind that the VA requires a permanent foundation be present. This is because the American taxpayer is the guarantor for the loan. And the program is not designed to allow for the possibility of a vacant lot to be foreclosed upon.
Herein lies the key. If you can prove that you are going to have a home on the land, and you can produce the documents to this effect, you may qualify for financing so long as all other VA requirements are met. Not all lenders will be willing to finance this deal. Particularly if you are looking to put a prefabricated home on the lot. Be sure to shop around until you find one that does.