VA Loans are mortgage loans available to borrowers who have served or are currently serving in the U.S. Military. The loan does not come directly from the Department of Veterans Affairs, as they do not lend money for this purpose, however they are willing to secure the loans offered by private lenders to qualified applicants.
Certificate of Eligibility is Required
The first step in securing a loan of this type is to acquire a certificate of eligibility from the VA. This will prove to private lenders that the loan is backed by the VA, and thus any participating mortgage lender may offer financing. Lenders can also get the certificate on behalf of their clients.
Other VA Home Loan Eligibility Requirements
Applicants for this loan must have suitable credit, sufficient income, and a valid Certificate of Eligibility (COE) to be eligible for a VA-guaranteed home loan. The home must be for your own personal occupancy.
Benefits of a VA Loan
- Normally no down payment is required. In certain circumstance the lender might require one in the event they feel the purchase price is more than the reasonable value of the property.
- Negotiable interest rates.
- The mortgage is assumable, and offers the right to prepay without penalty.
- The loan is provided with no mortgage insurance premiums, and closing costs are comparable with other financing types (and may be lower).
- The VA offers assistance to veteran borrowers in default due to temporary financial difficulty.
- 100% financing for refinance and new loans
- Jumbo Loans also available
The VA Loan, which can trace its roots back to the Serviceman’s Readjustment Act passed by Congress in 1944, has been a vital tool in helping veterans to re-integrate themselves back into society following their service. Thus if you currently serve, or are a retired veteran of the United States military, this loan is an excellent opportunity for you to secure home financing.
