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.