When you’ve decided to purchase a home, much of your time is likely to be spent determining budget, figuring out which neighborhood to focus on, and quality of schools in the area. Many people, however, neglect to review the different types of loans and their features when making their purchase decision. One type of loan that is often overlooked is the Veterans Affairs, or VA, Loan, but if you are eligible for it, it could be just the mortgage you’re looking for.
Let’s take a look at some of the things you may not have known about VA Loans.
There are borrower eligibility requirements
In order to be eligible for a VA Loan, you need to be an active duty or veteran military service member. Your eligibility is determined by a number of factors, including branch, length of service, and when you served (for example, there are different requirements for service during wartime versus peacetime). In addition, some spouses of veterans are also eligible for VA Loans. Be sure to check with VA to obtain a Certificate of Eligibility (COE) prior to beginning your home search in order to confirm your eligibility.
…along with property eligibility requirements
Aside from borrowers being eligible, the requested property must also met certain standards, called Minimum Property Requirements. There are several requirements, but the main ones include:
- Property must be residential
- There must be adequate living space, heating, and roofing
- The property must be free of health and safety hazards, along with termites
- There must be no lead-based paint
Your Loan Officer should be able to provide you with a full list, but keeping an eye out for those items are sure to put you on the correct path.
Many VA Loans do not require a down payment or PMI
VA Loans are guaranteed by the government, meaning a government agency will assume responsibility for the loan in the event of default. So although you will still need to meet lender requirements, including a sufficient FICO score and debt-to-income ratio, you could avoid paying a down payment or private mortgage insurance.
VA Loans have certain mandates…but they are for your benefit
Many people fear working with government agencies due to loan requirements, most notably the appraisal. A VA Loan is no exception, with appraisals being mandatory and having a required window for completion (typically 10 days). Some may see this as a hassle, but this step is an important one in the home buying process as it assures that your home is valued appropriately so that you don’t begin your life as a homeowner underwater.
While there are certain guidelines that need to be followed in order to get approved for a VA Loan, there are many benefits that come along with these types of mortgages. Service First has years of experience working with VA Loans and will work to ensure that you get into your home as quickly as possible with as little hassle as possible.
If you’re ready to get started on your home buying journey, we can help!
Contact us today!