If you're a veteran, active service member, or a surviving spouse of a veteran or service member killed in the line of duty, you may be able to buy a home with help from the U.S. Department of Veterans Affairs and private lenders through the VA home loans program. This financial assistance can be of tremendous value to veterans and their families, but the process can be a bit confusing at times. That's why we've put together a few FAQs about veterans loans and whether you might qualify for one.
Why Are VA Home Loans Better Than Other Types Of Loans?
For many people, the VA Home Loan program will let them buy a home with up to 100% financing. For first-time buyers, in particular, this can be a huge advantage, as other types of loans won't usually offer that level of assistance. With these types of loans, there are no private mortgage insurance requirements or excessive closing costs. Borrowers are also not subject to certain types of fees that come with other types of loans. Finally, borrowers can also refinance to a lower rate without having to re-qualify for a loan. Essentially, it's much easier and less of a financial strain to buy a home with a VA loan.
How Do I Know If I Qualify For The VA Home Loan Program?
To be eligible for the VA Home loan program, an individual needs to have served 181 days during peacetime, 90 days during war time, or six years in the Reserves or National Guard. Surviving spouses of service members who were killed in the line of duty or who now have a service-related disability may also qualify. Keep in mind that you will not be considered eligible for VA financing solely due to active duty for training in the Reserves or National Guard. You will need to obtain a Certificate of Eligibility to prove your service and apply for a VA loan (the Certificate of Eligibility can be requested via mail or through the online VA benefits portal).
How Much Financing Will I Qualify For?
Every veteran's situation will be different and every state has different regulations pertaining to VA loans. Typically, your credit score, income, debt-to-income ratio, and cost of living in your area will be examined. The debt-to-income ratio on a VA home loan is typically much more flexible than other loan programs.
While the Fannie Mae conforming loan limit is currently $647,200, beginning January 1, 2020 there is no longer a loan limit for a VA Guaranteed Loan. No down payment is requiried for VA loans exceeding the Fannie Mae conforming loan limit.
Your lender can give you a much more complete idea of what your loan situation will look like.
How Long Will The VA Loan Approval Process Take?
The amount of time it takes to obtain approval can vary, so you should give yourself at least 30 days. It may be approved sooner, but it's better to have extra time, should you need it. You can also be prequalified for a VA home loan if you haven't yet started looking for a house. This is actually recommended , since it allows you to have financial peace of mind while house hunting, rather than choosing a house you can't really afford or dealing with the stress of a time crunch.
Will Every Lender Offer the VA Home Loan Program?
It depends. Not every bank or private lender will specialize in this area, so it's important to do your research and choose a lender who handles VA loans on a regular basis. They'll be in a much better position to help you throughout the process.
If you're considering applying for a VA loan through the VA Home loan program to buy a house in Texas, we're here to assist you. For more information, please call us toll-free at 866-704-2826 or send us an email and one of our knowledgable and courteous VA loan professionals with be happy to assist you and answer any questions you may have.
Photo courtesy of Rebecca Amber