Did you know there are more than 27 million veterans eligible for VA financing? These potential home buyers enjoy significant loan advantages not available to non-veteran homebuyers. If you’re working with prospective home buyers right now, check with them to see if they are veterans. If they are, make sure they are aware of the VA financing advantages available to them.
What are the advantages of VA financing?
? Loan may be up to 100 percent of the property value. Generally, loans may not exceed $417,000. Subject to change each year.
? You don’t have to be a first?time homebuyer.
? No PMI required.
? The VA limits the closing costs the buyer pays.
? Closing costs may be paid by the seller.
? Right to prepay the loan without penalty.
? VA offers personal loan servicing and financial counseling to help veterans during financial difficulties.
Who is eligible?
? Veterans and active duty personnel.
? Certain reservists and National Guard members.
? Surviving spouses of persons who die on active duty or of service?connected disabilities.
? Certain spouses of active duty personnel who are (a) missing in action, (b) captured in line of duty by a hostile force, or (c) forcibly detained by a foreign government or power.
What are the buyer requirements to obtain a VA loan?
? The applicant must be an eligible veteran who has available entitlement.
? The loan must be for an eligible property.
? The veteran must occupy the property as a home within a reasonable period of time after closing the loan.
? The veteran must be a satisfactory credit risk. The income of the veteran and spouse, if any, must be stable and sufficient to meet the mortgage payments, cover the costs of owning a home and other obligations and expenses.
What can you use a VA loan for?
? Purchase a home, condominium in a VA?approved project or cooperative.
? Purchase and improve a home.
? Refinance an existing home loan (up to 90 percent of the value) or refinance an existing VA loan for a lower interest rate.
? Buy a manufactured home and/or lot.
? Build a home.
? Improve a home by installing energy?related features such as solar or heating/cooling systems, water heaters, insulation or other energy efficient improvements.
How is the loan application process different?
Aside from securing a Certificate of Eligibility and the appraiser is assigned by the VA, the application process is the same as other mortgage loans. Your buyer gets the loan from a private lender and the VA stands behind the loan.
Four easy steps to obtain a VA loan
1. The veteran must apply for a Certificate of Eligibility (COE). To get a Certificate of Eligibility, visit online at www.ebenefits.va.gov or call the VA Help Desk at 1?800?983?0937.
2. Choose a home to buy and sign a purchase agreement.
3. Apply to a mortgage lender for the loan.
4. Order an appraisal from the VA. (Usually done by the lender.) While the appraisal is being done, the lender can gather credit and income information. If the lender is authorized by the VA to process loans on the automatic basis, the loan can be approved and closed upon receipt of the appraised value determination without waiting for a VA review of the credit application.
Want to learn more about VA loans?
For additional information or to obtain forms please visit: http://www.homeloans.va.gov/. Or call: 1-800-827-1000.