The VA loan is a great loan program to use for anyone that has been in military service. A VA Loan is a type of mortgage that is guaranteed by the US Department of Veterans Affairs for the purchase and refinancing of primary residence. Veterans Affairs is not a lender, they back up the lender and guarantee the loan.
Who Is Eligible for a VA Loan?
- National Guard members/Reservists
- Active-duty personnel
- Spouse if they do not remarry
What Can A VA Loan Be Used For?
A VA loan can be used for the following purchases:
- Single Family Residence (Home)
- Manufactured home
How a VA Loan Helps?
VA loans help service members, veterans, and eligible surviving spouses get their dream homes. The US Dept of Veterans Affairs (VA) provide home loan guaranty benefit and other housing related programs to aid in buying, repairing, building, retaining or adapting a home for personal occupancy. VA loans enable you to borrow from lenders with favorable terms.
Ways to Use a VA Loan
- Purchase Loans– These are loans that help you buy a home at a competitive interest rate and often without down payment or private mortgage insurance. The VA will guarantee up to 417,000 of the total loan amount.
- VA Refinance Loan- There are two way use a refinance loan. You can use it to refinance to a lower interest rate or to do a “cash-out” refinance. A “cash-out” refinance is a way for owners to cash out a portion of their home equity to take care of concerns such as: paying off debt, funding school, or making home improvements. The “cash-out” option is limited to $144,000
What is a VA Home Loan Guaranty?
A Va home loan guaranty makes the VA “stand behind” the loan by guaranteeing a portion of it. VA insures the lender that they will provide in case the borrower comes short.
What are the Advantages of a VA Home Loan?
Favorable terms are given to the borrower since these loans are guaranteed by VA. These terms include:
- No down payment for lesser or equal appraised value
- No private mortgage insurance premium required
- Limited closing costs through VA rules
- Sellers maypay the closing costs
- No penalty from lender when you pay the loan off early
- VA may assist you when you run into payment difficulties
- You don’t have to be a first-time buyer
- The benefit is reusable
- The loans are assumable given that the person assuming is qualified
How to Apply for a VA Loan
- Purchase Loan & Cash-Out Refinance: Purchase loan and Cash Out Refinance can be obtained through a lender of your choice as long as you have obtained a Certificate of Eligibility (COE). The COE can be obtained througheBenefits, by mail, and often through you lender. Learn More
- Interest Rate Reduction Refinance Loan: In getting an Interest Rate Refinance Loan you can use your current COE since a new one is not required. The COE is used to show your prior use of your entitlement or your lender may use our e-mail confirmation procedure in lieu of a Certificate of Eligibility.
- Native American Direct Loan (NADL) Program: A Native American Direct Loan (NADL) Program needs the borrower to confirm with the tribal organization if they participate in the VA direct loan program. These NADL loans are obtained through a lender of your choice as long as you have obtained a Certificate of Eligibility (COE). You can get a COE through eBenefits, by mail, and often through you lender.
Adapted Housing Grants: For Adapted Housing Grants you have to download the application form VA Form 26-4555 and submit it to your nearest Regional Loan Center. Learn More