If you are a military veteran or are on active duty, a VA loan may be the perfect loan for you. The Veterans Administration provides guaranteed loans, made by VA-approved lenders to eligible military members. The VA guaranty protects the lender not the borrower from loss resulting from the loan not being repaid. The VA loan programs offer many advantages to veterans and can be obtained with little or no down payment with a competitive mortgage rate. Borrowers can choose a fixed or variable rate loan. The loan can be used to purchase a home or refinance an existing loan. The process is different from conventional loans.
There are a series of things to be aware of before you start, they are:
- Eligibility ― To apply for eligibility you must be:
- A veteran who served on active duty and have a discharge other than dishonorable after serving a minimum of 90 days during wartime or a minimum of 181 continuous days during peacetime.
- National Guard and Reservists must have served for six-years.
- Check Your Credit ― The Fair Credit Reporting Act guarantees individuals access to their credit report — free from each of the three nationwide credit reporting companies — Experian, Equifax, and TransUnion — every 12 months. Order the report and read it. Credit reports can contain bad information. Reviewing it in advance apply for a loan or getting pre-qualified gives you time to correct errors and make comments.
- Find a Lender ― Choosing to get a VA loan means choosing to participate in a loan program with specific rules. Not all lenders in the market can offer VA loans. Choose a VA-approved lending institution that can handle your home loan. There are several sites that can help locate a lender. Try the VA home loan site for information on lenders. The fees charged by lenders will differ so it is best to shop around. Remember, as it is with credit, you need have a income and a satisfactory credit history to get approved.
- Pre-Qualify ― Use your approved VA lender to pre-qualify you for a loan amount before house hunting. This saves times and gives buyer an advantage fast selling markets because no mortgage contingency needed.
- Loan Limits ― There are specific limits to the mortgage amount you can be granted. Check the VA’s loan limit page to see what the limit is in your area.
There is surprising little red tape involved is getting a VA loan. Use your chosen lender to research issues and walk you through the process. There are many ways to use your VA eligibility such as refinancing an existing mortgage. It pays to use the resources available. Check out what options may fit your circumstances