VA Loans 101: Everything a Veteran Needs to Know
What is a VA Loan?
When military veterans and their families are looking to get a mortgage, one of the options that they can consider is a VA loan. A VA loan is a type of mortgage that is provided by the Department of Veterans Affairs. It is given to those who served or are currently serving in the United States military. VA loans are issued by private banks, but are backed by the Department of Veterans Affairs. This type of loan is not only given to military veterans, but their spouses and other family members who qualify for financing as well.
There are three types of VA loans: purchase loans, interest rate reduction refinance loans, and cash out refinance loans. A VA loan offers many benefits, including not needing a down payment to purchase a home. For many people in the military, home ownership can be very attainable as a result. In many cases, a VA loan will allow a military member to purchase a home that they would otherwise be unable to afford.
Eligibility for a VA Loan
There are a number of people who are eligible for VA loans. These include individuals who are currently serving in the military, those who served in the past, their spouses, and their family members. Those who are able to receive mortgage funding from the VA also include reserve members and National Guard members.
In order to get a VA loan, each military member and their relatives must have a good credit rating, a sufficient income, and a Certificate of Eligibility that is currently valid. They must also use the home they are financing for their own personal occupancy. Anyone who is unsure about their eligibility will benefit by checking with the Department of Veterans Affairs. They will be able to check out the current eligibility requirements for all military service members, their spouses, and their relatives.
Benefits of a VA Loan
There are a number of benefits that are offered by VA loans. These benefits allow many veterans and their families to capitalize on perks that are not often provided by other mortgage lending sources. A VA loan provides the option to get a mortgage without a down payment. They also offer an interest rate that is very competitive and negotiable. You can finance the VA funding fee, have limits on how much closing costs can be charged, no private mortgage insurance premiums, and the right to prepay your mortgage without any penalties. There is also assistance available for those who are in default, or are experiencing financial difficulty.
How Veterans Get a VA Loan
There are four steps to take in order to secure a VA mortgage loan. The first step is to make sure that you are eligible. Next, you will need to find a lender that offers VA mortgage loans. You will also need to obtain a Certificate of Eligibility in order to qualify for a VA loan. With the final step, you will need to apply for a VA loan through a VA lender. As a result, the steps in getting this type of funding are quite simple for veterans, and their eligible family members.
How to Find a VA Loan Lender
Before you get a VA loan, you will need to find out who offers VA mortgage loans. Fortunately, there are a number of VA approved lenders in your area. In order to find VA approved lenders, you can visit the VA website, or get recommendations from other military personnel you may know. It will also be beneficial to shop around at different financial institutions. You can even visit the site Zillow, which can help you find a reputable VA lender in your area. This will help you determine who offers VA home loans.
Once you find a VA approved lender, you will then want to know what the current VA home loan rates are. As stated earlier, the rates are very competitive, but are also negotiable. In most cases VA mortgage loan rates are between 3 percent and 5 percent, which can make for a very affordable mortgage.