Home Buying Made Easy for Veterans: A Guide to VA Home Loans

You served in the military for years, and now you've rejoined civilian life. Or maybe you’re still serving and are ready to live off-base. A recent survey found that about 18 million veterans live in the United States. One of the greatest and most amazing benefits available to US veterans is the VA home loan program. But, many veterans don't know enough about it to consider applying.   Don't worry! Our Mortgage Expert, Tracy Hayes of Jet HomeLoans, put together a quick guide to explain what you need to know about VA loans. He notes that most loan officers truly enjoy working with the VA Home Loan as it is one of the most forgiving loan products available. Keep reading to find out how you can take advantage of this incredible reward for your service.  

What Are VA Home Loans?   The VA home loan is a special home loan for veterans of the US military that needs no down payment. You can buy or build a home using a VA home loan program. Whether you have little money available for a down payment to purchase a home, or want to complete a simple refinance, a VA Home Loan makes it easy. In most cases, if you are putting less than 5% down, the VA Home Loan will be better than any conforming loan program or FHA. The VA loan does not have a Mortgage Insurance (MI), and you may have the VA Funding Fee waived if you receive disability from the VA.   

Who Is Eligible?   Army, Navy, Air Force, Marines, National Guard and Coast Guard active duty and veterans are eligible. One big misconception veterans have is they think they need to have served in combat. That is not true. Over the last few years, the VA has simplified who is eligible. Typically, anyone that has had 90 days of active duty may qualify for a VA loan. The Certificate of Eligibility can be retrieved by most lenders within a few minutes with the basic information on any veteran. Having your DD-214, or Certificate of Release or Discharge from Active Duty, is not always required, but is often requested simply to assure we are working with the correct veteran. The DD-214 outlines exact dates of service and should always be saved by any discharged service member.     

Are There Alternatives?   If you aren't eligible for home loans for veterans, there are other government-funded loan options to choose from. The FHA loan has great benefits like inexpensive down payments and limited closing costs.   

Loan Qualification   Many veterans think it’s complicated to apply or qualify for a VA Loan. As long as you have decent credit, enough income, and a valid COE from the VA, you should have no problem qualifying.  

Loan Limits   For first-time buyers or others with full entitlement, there are no mortgage limits to worry about. But, those with partial entitlement may need to pay a small down payment if the loan amount you want is more than 25% of the local loan limit. Also, a VA Home Loan does have closing costs. Occasionally, veterans may think they did not have to pay closing costs on their loan. An interested party like the seller can pay up to 4% of the loan amount towards the settlement cost with these types of loans. If structured properly, in many cases the veteran can buy a home with no money out of pocket.   

Turning Your Dream House Into a Reality   There's something about owning your own home that makes you feel successful. Owning a home for your family is part of the American dream after all! Keep this information in mind as you go through the loan application process. If you have questions about this article or if you're looking to buy a new home, contact us today!