Veterans and their families enjoy special perks as a result of their service. One of the biggest is the VA loan, which is a special mortgage loan designed with veterans in mind. These loans help veterans (or their surviving spouses) to purchase a house with no money down–the loan can cover as much as 103.5% of the financing, which will cover the full cost of the loan and the down payment. A VA loan can also be used to refinance or repair a house.
Even though a VA loan is guaranteed by the VA, the loan is still usually issued by qualified private lenders, like banks or mortgage companies. The VA backs the loan, and makes lenders more willing to extend veterans favorable terms.
There are several different types of loans for which veterans can apply. The most common is a purchase loan, which is used for the purchase of a new home. But there are also Interest Rate Reduction Refinance Loans, which can help lower your interest rate, Native American Direct Loans, which help Native American veterans purchase homes on Federal Trust Land. Disabled veterans can apply for Adapted Housing Grants, which help injured or disabled veterans build or modify their home to account for their disability.
To qualify for a VA loan, you need to meet the minimum service requirements as either a veteran, an active duty servicemember, or a National Guard member. While the VA does not look at credit scores to qualify you for a loan, many private lenders require a score of at least 620. You will also need to have steady, reliable income, and meet any other qualifications your private lender has.
If you are thinking about purchasing a home, you should first obtain a Certificate of Eligibility from either the VAs eBenefits site or through your lender. Once you have confirmed your eligibility, your lender can use this information to start the process of approving you for a VA Home Loan.
Purchasing a new home can be a long and sometimes frustrating process, but dont give up! Make sure you take advantage of all the benefits you deserve after serving your country.
