As with most subjects that are associated with mortgages, as well as finances, understanding Veterans home loans may be a bit confusing at first. In order to help you get started, here are a couple of tips for getting started with a VA home loan mortgages.
Military veterans, certain surviving spouses of vets, and certain members of the National Oceanic and Atmospheric Administration are eligible to apply for VA loan benefits. Veterans and non-veterans are permitted to apply for a VA loan together, but the VA will guarantee only the veteran’s portion of the loan.
About Veterans Home Loans
If you’re looking into purchasing a new house and you’re retired or active member of any branch of service, that includes the reserves or the public health service, you might be eligible for a VA home loan. These types of loans were especially made to aid the majority of military veterans who are interested in securing home ownership following or during their time in service.
Qualifying for Veteran Loans
Veteran loan eligibility will greatly vary depending upon the length of service, the military branch of service, as well as the dates of service. Usually, eligible recipients have to have served for a minimum quantity of time, as well as have to be either active service members or received honorable discharge.
The quantity of time in which you need to have served will depend on your responsibilities within the services. For instance, reservists have to have served for a minimum of 6 years during a peace time, as the ones who served within active duty in time of a conflict will require much briefer lengths of service.
Where to Apply
You may figure out if you are eligible for a Veteran home loan by speaking with your area Veterans Administration office. You’ll learn more on Veteran home loan entitlements, as well as what kind of limitation you might expect upon your personal home loan.
VA home loans feature no required down payment in most cases, but making a down payment reduces your VA loan funding fee, which as of January 1, 2020 changed to reflect the following new requirements:
The VA loan funding fee for forward loans (not refinance or reverse mortgages) is lowest for first-time VA loan borrowers who make a down payment of at least 10%. There is usually no down payment requirement, but borrowers who choose to make one get the benefit in lower VA loan funding fees.
All VA home loan borrowers will be required to pay the VA loan funding fee unless they are exempt because they receive (or are eligible to receive) VA compensation for service-connected disabilities. The amount of the funding fee for non-exempt applicants is based on the following scale:
- First-time use with no money down – 2.3%
- 5 percent down – 1.65%
- 10 percent down – 1.4%
Second-time use VA loan funding fees are as follows:
- First-time use with no money down – 3.6%
- 5 percent down – 1.65%
One of the best benefits to a Veteran home loan is that most veterans can qualify even if their credit possesses a couple of flaws as the loan is secured by the U.S. government.
Joe Wallace is a 13-year veteran of the United States Air Force and a former reporter for Air Force Television News
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