VA Home Loans, Veteran Benefit Information

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Home financing for Veterans through FHA Mortgage Programs, Refinance rates and Lending Guide updates from Mortgage Loan Place.

VA Home Loans -

The Department of Veterans Affairs helps veterans get home loans to help in buying homes for their own personal occupancy. Loans made by the VA are Guaranteed Loans, which means that the lender of the loan is protected against loss if the veteran receiving the loan is unable to repay the loan. What this Guarantee does for the lender, and for the veteran trying to get the VA Home Loan, is offer the protection that they normally receive through requiring a down-payment. This allows veterans to obtain favorable financing terms when paying back the VA Home Loan.
A VA Guaranteed Loan is made by a private lender. Banks, Savings & Loans, and Mortgage Companies are all types of lenders used by the VA when securing loans for eligible veterans.

There is no maximum amount that a veteran can get through a VA Guaranteed Loan, although lenders do often limit how much a will be lent out. Typically this amount is around $240,000. The reason for this limit is that the VA sells their loans on the secondary market, which currently places this limit on the loans. Veterans looking to get loans up to this amount, can expect no down-payment financing through the VA. Basic entitlement for veterans is roughly $36,000, but can rise to $60,000 for loan over $144,000. Lenders supplying the loans to the VA will often loan up to 4 time the available entitlement without a down-payment, provided that the veteran is income and credit qualified and the property being used for appraisal equals the value of the asking price.

The VA can guarantee only the loan, and not that a home is free of defects. It is the responsibility of the veteran to ensure that the property that they are purchasing is up to their satisfaction. When the VA appraises a home, it is not an "inspection" of the property. Before a veteran legally commits to a purchase agreement (or loan), they should seek expert advice in the form of a qualified residential inspection service. The VA cannot guarantee that the veteran is making a good investment in their choice of homes, and therefore cannot provide a veteran with any legal services that may arise out of selecting a home. The VA can only guarantee the Home Loan that the veteran receives. If construction defects are found by the VA during appraisal, the VA cannot force the builder to fix the defects, and can only suspend that builder from participation in the Home Loan program.

Benefits and Features of a VA Guaranteed Home Loan
* No down-payment (although some lenders do require one)
* Equal opportunity for all qualified veterans
* The Buyer is informed of reasonable value
* The Interest Rate is negotiable!
* No Mortgage Insurance Premiums!
* Reduced funding fees with a down-payment of at least 5%
* Ability to finance the VA funding fee
* Closing costs are often lower than other financing types
* An assumable mortgage
* No penalty for prepay!

What are the benefits of a VA loan vs. a conventional loan?

100% financing with no mortgage insurance which means your entire interest payment is tax deductible.
Approval with less than perfect credit and still obtain a quality rate
When you are ready to refinance a VA loan you can do so through a "streamline refinance". A streamline refinance requires no income, asset, or credit verification, while it is also much cheaper than a conventional refinance because many of the traditional closing costs are waived.

Steps that a Veteran must take in order to obtain a VA Guaranteed Loan
1. The Veteran must apply for and get a Certificate of Eligibility
2. The Veteran must select a home and discuss the purchase with the seller or selling agent
3. The Veteran must sign a purchase contract on approval of a VA Guaranteed Loan
4. The Veteran must complete a Certificate of Eligibility
5. The Veteran selects a lender, presents them with their Certificate of Eligibility and completes the loan application
The Lender will determine the Veterans credit, and the VA will have the veterans home appraised. The lender or the VA will issue a value on the property for loan purposes.
6. The Veterans loan will be approved if all parties and the lender determine that they are credit and income qualified.
7. Once the loan has been approved, the Veteran attends the loan closing, signs the note and mortgage.
8. The Certificate of Eligibility is returned to the Veterans after explanation of how monthly payments will be made, and after the Certificate has been annotate by the VA.
(This procedure may vary from state to state)

We are not associated with the Department of Veterans Affairs or any governmental agency.
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