A VA home loan is a mortgage loan offered in the U.S backed by the United States Department of Veterans Affairs (VA). This type of mortgage loan is solely for American veterans, military members who are currently serving in the U.S. military, reservists and qualified surviving spouses (spouses of death military members).
The purpose of the VA home loan is to provide a means of financing a home by qualified veterans. With no down payment and a funding fee (unless exempted) of 0-3.3%, you can qualify for this type of loan. VA doesn’t require a minimum credit score but most lenders try to settle on 620.
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Eligibility requirements of VA home loan
Veterans who qualify for VA loans must meet the following requirements;
- Minimum number of days completed service (90 consecutive days of active service during war time, 181 days active service during peacetime, 6 years of service in the National Guard/Reserve)
- Length of service/service commitment
- Duty Status
- Character of Service
- Have a valid Certificate of Eligibility (COE)
Types of VA loans
- VA Purchase Loan
- VA Interest Rate Reduction Refinance Loan (VA IRRRL)
- VA Cash-Out Refinance
- VA Energy Efficient Mortgage
Documents required of applicants
- Report of Separation
- Statement of Service
- Report of Separation
- Record of Service
- Retirement Points Accounting
- Proof of the Character of Service
Requirements of surviving spouses to proof their eligibility
Surviving spouses can to present the following items to verify they qualify for VA home loans.
- A valid Certificate of Eligibility (COE).
- Copy of Veteran’s Separation paperwork.
- A copy of marriage license
- A copy of veteran’s death certificate
How to apply for a VA home loan
Here is how you can apply for a VA loan;
- Contact a VA lender to begin the process on your loan.
- Verify eligibility by obtaining your
Certificate of Eligibility (COE) - Fill out your application and provide the necessary required of you.
You can also get preapproval before you hit on the main application.
Benefits of VA loans
- No downpayment
- Easy to qualify
- No Private Mortgage Insurance
- They have low interest rate
