5 Essential Facts About a VA Loan

Purchasing a home is one of the biggest financial decisions anyone will make in his or her lifetimes. Paperwork, real estate agents, choosing a neighborhood—and how many bedrooms? Moreover, do I choose the home with the jacuzzi? Where do I start when trying to get a loan? Don’t worry—you are in good company. We hear this all the time. Most people don’t have a clue where to start, and all the choices can feel overwhelming.If you are a veteran looking to take the leap using a VA loan, your loan details are often different from someone who is using a conventional loan.

Becoming informed of your financing options should be your first step. The truth is that the details matter when choosing your financing plan and your mortgage lender.  First, let us lead with the fact that those of us here at Loanatik are profoundly grateful for the service of our veterans. We are proud to work with our Service Members, Veterans, and surviving spouses as they embark on the journey to becoming homeowners.

If you are a veteran or active duty member looking to buy a home, you may qualify for a VA loan. If so, you’ll want all the facts before proceeding.

Here are five commonly asked questions about choosing and obtaining a VA loan.

How much do I need for a downpayment?

Let’s start with the good news. If you qualify for a VA loan, you are entitled to 100% financing and do not need a downpayment. Unlike conventional loans, VA loans do not carry the requirement of mortgage insurance, which is another plus.

Although a down payment is not required, it is important to keep in mind that VA loans still require upfront fees. These fees are dependent upon the amount of the downpayment and are lower than the costs of a conventional loan. If you can make a downpayment of 10%, the fees are cut nearly in half. So while the downpayment is by no means required, it does lessen up front fees and extra costs.

Do I qualify?

Just like any loan you apply for when buying a home, there are eligibility requirements to be met before qualifying. The VA loans are slightly easier to qualify for, but there are requirements nonetheless.

According to bankrate.com, “Most active-duty military and veterans qualify for Veterans Affairs mortgages. Many reservists and National Guard members are also eligible. Spouses of military members who died while on active duty or as a result of a service-connected disability may also apply.”

Aside from the above requirements, other things are into account by your lender when determining eligibility. Some things that may affect your ability to obtain the loan are:

• Your credit score (not as stringent as conventional loans)
• A stable income

However, according to Bankrate, “borrowers must show sufficient income to repay the loan and shouldn’t have excessive debt, but the guidelines are usually more flexible than they are for conventional loans.”

The VA loan benefit was put into place so that, through dedicated service to our country, active duty military and veterans are granted a fair opportunity to purchase a home. Loanatik wants to help our heroes take the leap.

Can my sibling use my VA benefits to get a mortgage?

Unfortunately, siblings and children do not qualify for the VA benefits with a brother or parent as the active duty member or veteran. The only people who can use these loans are active duty and veterans, as well as a spouse (as long as the marriage is still standing). This benefit, unlike other VA benefits, is not transferable. At any rate, contact your lender for more details about particular circumstances. There is always a loan for someone who wants to purchase a home.

What about refinancing?

The mortgage is not the only VA benefit that exists within this realm, and refinancing should always be considered as it could result in a bit of extra cash in your pocket. The Interest Rate Reduction Refinance Loan (referred to as the IRRRL) is ideal for existing VA Loan holders who are looking to save a significant amount of money and take advantage of lower interest rates.

The IRRRL requires little paperwork and could significantly reduce monthly mortgage payments. It is always worth a look!

Where do I get a VA loan or refinance?

So you’ve decided that you be ready to take advantage of historically low mortgage rates or save yourself money by refinancing. Congratulations! Now where should you start? Do you go to the VA? The VA does not loan the money; it just guarantees the terms at your lender or bank.

Your next step is to find a qualified lender that you trust to manage your loan. Loanatik is a professional and experienced company here to help you get started.  Get a mortgage rate quote from us instantly. We have a wide range of programs to match your specific needs and are experienced in VA loan benefits.

In the end, the VA benefit is called a benefit for a reason. The VA loan is easier to attain, with better rates and is overall a more seamless process. We believe this is how it should be for our heroes. We appreciate your service, and Loanatik looks forward to serving you in your home purchase or refinances as you’ve served us.