A Note On Finding Va Lenders And Real Estate Agents
Lots of lenders offer VA loans. But they dont all have the same level of experience with them.
And with something as important as buying a home, you want a lender that knows these loans inside and out and understands veterans unique borrowing needs.
For that matter, you want a real estate agent who works often with veterans, too.
Sellers are sometimes wary of VA offers. Sometimes, VAs minimum property requirements and appraised values add roadblocks. A seasoned agent whos done many VA offers will know what it takes to get yours accepted and can give you a realistic path for finding a home.
Before choosing a lender or agent, vet their VA experience . Find out how often they work with veterans and what their records are with getting VA offers accepted and VA loans closed.
You might also ask whether they offer any other types of assistance or support to the veteran community. A company that works closely with veterans and their families, in lending and community service initiatives, is more likely to deliver the experience you need than one that only occasionally closes VA loans.
Before you choose a lender or real estate agent, ask them a few key questions:
Applying For A Va Loan
Applying for a VA loan is different from applying for a conventional mortgage, and this affects the home-buying process.
The VA recommends working with a real estate agent whos familiar with VA loans and getting prequalified with a lender before making an offer.
There are a number of steps to applying for a VA loan, including
- Obtaining a certificate of eligibility, which verifies to the lender that you meet minimum eligibility requirements.
- Comparing offers from different VA lenders to find the best interest rate and most affordable fees for you.
- Submitting a loan application and providing financial information, including pay stubs and bank statements.
- Obtaining a VA appraisal, which is ordered by the lender.
Your credit information, income and the value of the home will be reviewed, and then the lender will either approve or deny your loan. Make sure your purchase agreement has a clause called a VA option clause, which allows you to avoid financial penalties if the home doesnt appraise high enough.
When your loan is approved, the lender will choose a representative to conduct a closing, during which the money can be released and the property transferred to you.
How Does A Va Loan Differ From A Conventional Mortgage
VA loans differ from conventional mortgages in many important ways.
The VA warns that adding the funding fee and closing costs to your loan, rather than paying for them upfront, could leave you owing more than your house is worth or could reduce benefits of refinancing because your payments wont be lowered by as much.
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How Does A Va
With a VA-backed home loan, we guarantee a portion of the loan you get from a private lender. If your VA-backed home loan goes into foreclosure, the guaranty allows the lender to recover some or all of their losses. Since theres less risk for the lender, theyre more likely to give you the loan under better terms. In fact, nearly 90% of all VA-backed home loans are made without a down payment.
Lenders follow our VA standards when making VA-backed home loans. They may also require you to meet additional standards before giving you a loan. These standards may include having a high enough credit score or getting an updated home appraisal .
Service Requirements For A Va Home Loan
Not all current and former military members can qualify for a VA loan. To be eligible, you have to meet certain service requirements first.
Heres how those break down:
- At least 90 days of consecutive service during wartime OR
- At least 181 days of consecutive service during peacetime OR
- At least six years of service in the National Guard or Reserves
Surviving spouses of Veterans, Prisoners of War, those missing in action may also be eligible in many cases.
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What Is The Interest Rate On A Va Home Loan
This is an important question to ask before setting out to purchase a home. In short, interest rates are what lenders are charging you to use their assets . The interest rate is applied to the amount of the loan.
For example, if you borrowed $400,000 for your VA home loan and the interest rate was 2.5% over a 30-year loan, your estimated total payment would be $568,974.00 with a monthly payment of $1,580.
For more information on how to calculate your own payments given a specific interest rate, click here.
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Mineral Oil And Gas Reservations And Leases
There are two main threats from such leases. First, they may be an encumbrance, meaning they lessen your rights as the homeowner. And secondly, they may detract from the benefits youd otherwise expect as a resident. In other words, they may make the home a less nice place to live.
The appraiser must assess how much either or both those affect the value of the property and adjust her appraisal accordingly.
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Complete List Of Va Minimum Property Requirements
In addition to ensuring that home buyers dont overpay for a property, the VA appraisal process makes certain that the home is a safe, move-in ready primary residence for the buyer.
VA appraisers provide a thorough examination of the property to ensure that it conforms with over 30 VA minimum property requirements that we explore below.
Keep in mind, though, that a VA appraisal is not a home inspection. And despite the extensive list of VA MPRs, a home inspection is still recommended to ensure there are no hidden issues with the property that could be costly to fix after moving in.
Verifying Your Va Loan Eligibility Status
Lenders need what’s known as a Certificate of Eligibility to verify if a Veteran meets the minimum service requirements. Your COE provides the lender with confirmation that you qualify for VA loan benefits.
For most Veterans, this is an easy step. Your lender can typically pull your COE with only your social security number and date of birth.
In some cases, the process may be more complex. However, the important piece is you don’t need this document before applying for a VA loan.
Speak with a Home Loan Specialist to get your COE today. The process typically takes minutes to complete and ensures your home financing moves forward without delays.
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Does My Va Loan Eligibility Ever Expire
No, as long as you meet the qualifying service requirements, your VA loan benefits never expire. You can use them on your first home purchase and any subsequent home purchases after that.
There is, however, a limit to your loan entitlement or how much the VA will guarantee. Fortunately, once you sell a home and pay off the VA loan attached to it, your entitlement resets and can be used for a new piece of property.
Do Lenders Count Military Income
Lenders can count VA disability income and certain military allowances to determine how much you can borrow with a VA loan. Active duty service members receiving Basic Allowance for Housing can use this income to pay for part or even all of their monthly mortgage payment.
Other types of military allowances that can count as effective income include: flight pay, hazard pay, imminent danger pay and more. Lenders can also count National Guard and Reserve income.
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What Are The Va Home Loan Limits By Year And County
Find the VA home loan limit for the county your property is in.
2022 VA home loan limits
VA home loan limits are the same as the Federal Housing Finance Agency limits. These are called conforming loan limits.
Scroll to the Previously Announced Loan Limits section
Review the table with past loan limit information.
Find the year with the limits you need
Years are located in the first column, labeled Description.
Refer only to the One-Unit Limit column in the table
This is the only column that applies to VA home loan limits.
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Who Is Eligible For A Va Loan
You may be eligible for a VA loan by meeting one or more of the following requirements:
- You served 90 consecutive days of active service during wartime.
- You served 181 days of active service during peacetime.
- You have 6 years of service in the National Guard or Reserves.
- You are the spouse of a service member who has died in the line of duty or as a result of a service-related disability.
Don’t meet the minimum service requirements? You may still be eligible: Talk with a Home Loan Specialist today
Who Can Get A Va Loan
To qualify for a VA loan, you have to meet the military service requirements. This means either you or your co-buyer needs to:
- Have served at least 90 consecutive days of active duty during wartime, or 181 days or more during peacetime
- Be on current active duty with at least 90 continuous days of service
- Have served 24 consecutive months starting September 8, 1980 or later
- Have served six years or more in the National Guard or Selected Reserves
Spouses who were married to servicemembers who died in the line of duty, or due to a service-connected disability, injury, or illness, may also qualify, provided they have not remarried.
To qualify for a VA loan, youll need whats called a Certificate of Eligibility, or COE.
You can request your COE through the VA eBenefits portal. A VA-approved mortgage lender can also look up your COE in just a few minutes once youre ready to apply.
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Gather Your Financial Documents
VA loan underwriting works a lot like other types of loans, including conventional loans and FHA loans. Your lender may ask for:
- Your recent W2 forms to show your income history
- Recent pay stubs to show current earnings
- Bank statements to show assets
- IRS income tax form transcripts
Gathering this information before you start the application process will save a lot of time.
What Are The Va Loan Terms For 2022
As of 2020, VA loan no longer have value limits for qualified borrowers. That means first-time VA loan borrowers will have no cap on the size of $0 down VA loans. The VA funding fees, which most borrowers have to pay when they close on their mortgage, remain the same as they were in 2020.
The funding fees range from 0.5 percent on some refinances to 3.6 percent for some home purchases. The exact fee varies depending on the value and type of your loan, how much you put down, and whether its your first VA financing.
These one-time fees help keep the loan program running. However, some borrowers may have to pay slightly more than the published rates in 2021. Veterans and service members will be charged the higher rates though National Guard and Reserve members will have their funding fee lowered to the same level as other military borrowers.
Veterans with service-related disabilities and some surviving spouses dont have to pay a funding fee. Purple Heart recipients on active duty are also exempt from the fee.
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Va Mortgage Loan Options
If you are a conventional home buyer, you will most likely be looking to secure VA-backed purchase loans. This loan will help you buy, build, or improve a home with a competitive interest rate and the option to put no money down without restriction.
Interest Rate Reduction Refinance Loan :
If you already have a VA home loan and would like to reduce your monthly mortgage payment or interest, an Interest Rate Reduction Refinance Loan could be the right choice for you.
Cash-out refinance loan:
A VA-backed cash-out refinance loan can help you take cash out of your home equity. This loan will replace your current loan with a new VA loan under different terms. You can also use a VA cash-out refinance to refinance a non-VA loan into a VA-backed loan.
We would also like to mention that the VA offers a Native American Direct Loan . If you are veteran, and either you or your spouse is Native American, you may qualify for this loan. Because the VA directly backs this loan, you do not need to contact a private lender the U.S. Department of Veterans Affairs will serve as your lender.
Q: What Is Acceptable Proof Of Military Service
A: If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which identifies you and your social security number, and provides your date of entry on your current active duty period and the duration of any time lost.If you were discharged from regular active duty after January 1, 1950, a copy of DD Form 214, Certificate of Release or Discharge From Active Duty should be included with your VA Form 26-1880. If you were discharged after October 1, 1979, DD Form 214 copy 4 should be included. A PHOTOCOPY OF DD214 WILL SUFFICE…..DO NOT SUBMIT AN ORIGINAL DOCUMENT.
If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which shows your date of entry on your current active duty period and the duration of any time lost.
If you are still serving in the Selected Reserves or the National Guard, you must include an original statement of service signed by, or by the direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters showing the length of time that you have been a member of the Selected Reserves. Again, at least 6 years of honorable service must be documented.
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Can A Spouse Apply For A Va Loan
Yes, surviving spouses may be eligible for a VA loan. Here are some eligibility cases for spouses, according to the VA website:
- A spouse, who has not remarried, of a veteran who died in service or from a service-related disability
- A spouse of a prisoner of war or service member missing in action
- A surviving spouse of a veteran, who is receiving compensation for a non-service-related death.
- A surviving spouse who remarried at age 57 or later, on or after December 16, 2003.
- In some cases, a surviving spouse of a totally disabled veteran whose death was not related to the disability.
Learn More About Eligibility And Va Loan Applications
VA loans are a great way for veterans, military personnel, and surviving spouses who qualify to buy or refinance a home. The benefits of VA loans include 0% down payments, no mortgage insurance, flexible credit scores, and competitive interest rates.
How you apply for a VA loan is similar to the way you apply for other types of mortgages. There are some differences, however. Read on to learn more about how to apply for a VA loan!
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Service During War Time
If you served during World War II , the Korean War , or Vietnam , and have served at least 90 days of active duty with an other than dishonorable discharge. Less than 90 days is allowable if you were discharged for a service-connected disability.
For the Gulf War , service requirements are as follows:
1. 24 months of continuous active-duty with other than dishonorable discharge
2. 90 days or completed full term that was ordered to active duty with other than dishonorable discharge
3. 90 days active duty, but discharged for hardship, convenience of the Government, early out, a RIF , or compensable service-connected disability
4. Less than 90 days active duty is allowable if you were discharged for a service-connected disability