Are you an active member of the military or veteran who is searching for a home? The Department of Veterans Affairs offers resources such as VA loans as a benefit of your service. The VA loan allows military members and veterans to purchase homes with as little as a 0% down payment and features flexible options for repayment with both fixed rate and adjustable rate mortgages.
What Are the Basics of VA Loans?
VA loans are backed by the U.S. Department of Veterans Affairs, so they can often be secured with little to no down payment and no PMI. This gives veterans the option to finance 100% of the purchase price of a property. Lenders may want to see credit and current financial statements to qualify, but requirements are often less stringent than other loans. Borrowers may be responsible for closing costs.
The VA Home Loan Process
The process of securing a VA home loan is typically the same as other types of home purchases. The buyer will make a written offer to purchase the home and will then be subject to their lender’s approval process. One of the primary differences between VA home loans and other types of mortgage loans is that the Department of Veterans Affairs must inspect each home to ensure that they meet necessary habitability requirements. This step ensures that the property is worth the amount it is being sold for, which is a great benefit for veterans. It’s important to keep in mind that the inspection and appraisal can lead to delays if there are repairs required by VA inspectors.
How VA Home Loans Work
VA loans are flexible and allow veterans to purchase homes with 0% down payments. VA home loans are available in 15, 20, 25, and 30 year terms with fixed rates. 5-year adjustable rate mortgages are also available. Key benefits of VA loans include:
- No monthly private mortgage insurance (PMI)
- No pre-payment penalties for paying off the loan early
- Flexible documentation requirements streamline the refinance process
- Reduced funding fee
Who Qualifies for VA Loans?
Not all veterans who have served in the Armed Forces qualify for VA loans. To qualify, veterans need to have a record of military service with requirements that will depend on whether time was served during peacetime or in war and the time period of service. National Guard, Selected Reserve members, and surviving military spouses may also be eligible for VA loans. Thompson Kane & Company can help you determine if you qualify for a VA loan based on the criteria set by the Department of Veterans Affairs.
What Are VA Loan Limits?
VA loan limits have been capped in the past, however, as of 2020 there are no longer mandated loan limits for the VA. This means that veterans can secure VA home loans at various price points if they qualify.
Have questions regarding VA loans? Give us a call at Thompson Kane & Company! One of our trained VA Home Loan specialists would be happy to answer any questions you may have pertaining to VA loans, eligibility, and rates.
**Thompson Kane & Company is not affiliated with, acting on behalf of, or at the direction of FHA, VA, USDA, or the Federal Government.
