FAQ's About Texas Vet Loans & VA Home Loans
VA Home Loans have many features and some very important restrictions. It is understandable that you may have questions related to specific scenarios about the VA Home Loan Program.
The easiest way to get answers to specific questions is to call Texas Veteran Home Loans.com and speak to a knowledgeable VA Loan specialist. We can be reached Toll-Free at 866-704-2826
Following are answers to the questions we are asked most often about VA Home Loans...
Chris says: The VA partially guarantees loans made by private lenders to veterans. The VA Home Loan program was designed as a benefit to veterans to make it easier for veterans to achieve home ownership.
Because the VA guarantees a portion of the loan, lenders are able to make VA loans available with no down payment requirement. The VA’s guaranty is protection to the lender, much like a down payment.
Herb says: Prepurchase counseling is not required, but is certainly worth considering, especially for first-time homebuyers.
Counseling serves to familiarize you with the process and terminology related to buying a home, and also how to budget for your purchase.
The goal is to help you become a better informed buyer.
Kevin says: No. The certificate only confirms that you have met the minimum service requirements to be “eligible” for the VA home Loan benefit. You must be approved by a VA approved lender, who will then underwrite and fund your loan.
Ray says: Entitlement is the amount of the loan the VA guarantees. A veteran’s basic entitlement is $36,000. A veteran may purchase a home for up to 4 times their available entitlement.
For purchase loans over $144,000 the VA offers additional entitlement up to the Fannie Mae conforming loan limit for that county.
Shawn says: The VA loan limits change from time to time. Currently the loan VA Home Loan limit is $453,100. This means that qualified veterans may purchase a home with no down payment up to $453,100.
If the price of the home exceeds $453,100 you will need to be prepared to pay 25% of the difference.
Chris says: The VA does not actually fund loans; they only guarantee a portion of the loan to a lender. To obtain a VA Home Loan, you must apply with a VA approved lender.
The lender will verify your eligibility, review your income and credit, and make a decision on the loan. The VA cannot compel a lender to approve a loan.
Herb says: Your VA approved lender should be willing to assist you with obtaining your certificate. Lenders have access to a VA database called ACE (Automated Certificate of Eligibility).
If the VA has enough information in ACE about a veteran, the lender can retrieve a copy of your certificate in minutes.
ACE does not have information about every veteran; in some cases the lender will need additional information, such as a printout of your DD214, to access your certificate.
You can also request your certificate by mailing VA form 26-1880 to the VA’s Eligibility, but requests by mail take much longer to process.
Kevin says: The VA Funding Fee (VAFF) is charged by the VA on every loan, whether a purchase or a refinance. (Veterans with a 10% or higher service-related disability are exempt from the Funding Fee).
The Funding Fee is paid to the VA to help defray the cost of administering the program, and cannot be waived.
Ray says: Yes, it is possible to get a VA Home Loan following a bankruptcy. The VA guidelines state if the bankruptcy was discharged over 2 years ago, it may be disregarded.
You cannot have any derogatory credit following the bankruptcy. It helps if you have established some new lines of credit since the bankruptcy, and of course there are many other factors the lender will consider.
It is best to contact a VA approved lender and have them review the factors that caused the bankruptcy and your current financial situation.
Shawn says: A foreclosure, deed-in-lieu of foreclosure or short sale within the previous two years since the disposition date is generally not eligible for a VA insured mortgage.
Also, if the foreclosure involved a VA Home Loan, the veteran may not have full entitlement available for future VA loans.
If 2 or more years have passed you may qualify. You should contact a VA approved lender to review your current financial situation.
Chris says: VA Home Loans offer many advantages. They are about the only loan that requires no down payment. VA loans are normally easier to qualify for. There is no prepayment penalty.
Veterans home loan rates (Texas) are attractive, and VA loans have no monthly mortgage insurance requirement.
The VA also allows the seller to pay closing costs, allowing veterans to buy a home with little or no out-of-pocket expense.
Herb says: No. The VA only guarantees the loan. The VA appraisal is used to determine the value of the property, and to verify the property meets or exceeds the minimum condition requirements to be eligible as security for the loan.
The VA recommends you have an independent inspection done for your protection prior to purchasing any home.
Kevin says: No, the VA only guarantees loans for properties located in the United States.
Ray says: No. The VA requires the veteran to occupy the property within 60 days of closing. If the veteran is unable to occupy the property due to deployment, the spouse can satisfy that requirement. Loans for investment properties or second homes are not allowed.
Shawn says: A spouse as a co-signer is allowed, and the income of the spouse will be considered. Two eligible veterans who wish to join together to purchase a home is also allowed. Any other co-signer will require the prior approval of the VA.
Most VA approved lenders are unwilling to make this type of loan because the amount of the guaranty the VA provides is reduced in this situation.
Chris says: No. The surviving spouse must continue to make the payments to retain possession of the home. If there is no spouse, the property becomes a part of the veteran’s estate.
If you still have questions about VA Home Loans in general or you would like to speak with a loan professional about the prequalification process, please call us at 866-704-2826 or choose your loan type from one of the buttons below and complete our quick-and-easy online form and a member of our staff will contact you right away to discuss your options.
We welcome the opportunity to assist you.