If you’re a veteran or an active-duty soldier or a surviving spouse, you might have access to a very useful tool in purchasing a home: the VA home loan. This residential loan program, which is guaranteed by the U.S. Department of Veterans Affairs, attempts to make homeownership somewhat attainable to those who have served in the armed forces. Learning how these types of loans function is the first step toward realizing an important benefit that you’ve worked hard to earn.
What Is a VA Home Loan?
A VA home loan is a home mortgage issued by non-governmental lenders, which includes mortgage companies and banks, and guaranteed by the Veterans Affairs Department. That guarantee to the lenders gives much more security, which in turn allows them to give more favorable terms to the borrower. The primary goal of the program is to help veterans afford to buy a home with little down payment or with no down payment at all.
Who Can Apply for VA Loan?
VA loan qualification is not automatic and is determined on an individual service basis. Specifically, you qualify if you are an active-duty service member, a veteran who had at least minimum service entrance requirements, a National Guard or Reserve individual, or you are a surviving spouse of a service member who was killed in the line of duty or due to disability caused by service.
To establish that you qualify, you’ll have to acquire a Certificate of Eligibility (COE). It’s possible to acquire this paper from a VA-authorized lender, on the VA’s eBenefits website, or by mail. Your lender will sometimes obtain your COE on your behalf, so it’s really convenient.
Top Benefits of a VA Loan
One of the strongest points in favor of South Carolina VA loan lenders is that they usually require no down payment. That can eliminate a big hurdle to homeownership for many. Another big advantage is that it has no private mortgage insurance (PMI), which is typically required on conventional mortgages when the down payment is under 20%. Not having to pay PMI can amount to big savings over the life of the loan.
In addition, VA loans typically have market-competitive rates. Since the VA’s guarantee lowers the risk to the lender, it frequently translates to lower rates to you. Also, the program restricts the closing fees that lenders can charge, which keeps your out-of-pocket cost to a minimum.
Tips for a Successful Application
To get yourself in the strongest possible position to win, start by becoming pre-approved for your loan. A pre-approval gives you a good idea of how much you have to spend and also lets sellers know that you are a real buyer. It’s also a good thing to have a real estate broker who knows VA loans. Their knowledge will let you navigate the special requirements and paperwork more easily and make the process of application to close much smoother.
Explore Your Homeownership Prospects
VA loans offer you an amazing and worthwhile opportunity to homeownership that veterans and service members qualify for. No down payment and no PMI make it an opportunity you cannot afford to pass up. Take the first step and speak with a VA-experienced lender to learn what you qualify for and get started on the path to homeownership.
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