va loan applicationWhen someone rents a space to live in, be it an apartment or a whole house, an individual pays a particular amount of money every month in exchange of inhabiting someone else’s property. Following that logic, this makes one’s payment a complete expense. When you own a house of your own, your monthly house payments aren’t entirely an expense in that you are building equity. While you continue to pay for inhabiting a space for shelter, you are working on an investment that may benefit you over time. This means that if the property value increases in your community and you choose to have your house sold, you stand to make a whole lot more of money as an effect. This privilege is something renters are unable to enjoy.

The VA Home Loan

Still, house ownership doesn’t come simple for everyone and the journey to property purchasing can be a hurdle to many. Money is a tough subject, and the gathering of funds can be challenging. Fortunately, there is a sea of loans for most of everyone to enjoy. A Veterans Affairs home loan, for example, is one that benefits a certain demographic: service members and a few of their spouses. What makes this loan program significantly unique from others is that it does not demand for a down payment. In most cases, a qualified borrower will not have to fork out a deposit anymore.

Again, it’s best to repeat that this isn’t for everyone. Below are the qualifications and only one condition should be met for an application to be taken further:

  • Borrower must have served 90 successive days or active service over wartime.
  • Borrower must have delivered 181 days of operating service over peacetime.
  • Borrower must have more than 6 years of rendered service in the National Guard or Reserves.
  • Borrower must be a spouse of a military personnel who has died over war or has died as an outcome of a service-caused disability.

Moving forward, there is no FICO rating standard in a VA home loan contrary to FHA and conventional loans; however having an impressive credit score can still do a borrower wonders since the loan granters are still private but VA-approved lenders. High credit scores can help convince lending institutions into working with you on a loan. You see, VA loans are insured by the U.S. Department of Veterans Affairs and their only duty is to guarantee mortgage should a borrower resort to defaulting. At the end of the day, one will still work with non-government loan-providing companies.

Additionally, a debtor can also choose to merge their closing cost into the mortgage itself. What’s more, VA loans are passable and you may choose to have someone assume the loan in the distant future should you be unable to keep up. Right now, this specific loan program also has arguably the lowest rates in most, if not all, loan programs. Another very unique feature is that VA debtors will not have to keep paying for a mortgage insurance as it is not a requirement.

That said, does this mean everything is for free and VA debtor will not need to worry about anything else?

It’s a sweet deal, but it’s not completely paid for. A debtor will have to pay for a VA funding fee for the life of the loan. The rate for this is determined by how one is qualified in the first place. Paperwork also differ depending on how one makes the cut. Are you a spouse? An armed forces member who’s worked as a reserve? It all depends.

Currently maximum loanable amounts are diverse with $400,000 to $600,000 being the standard scope. What sets this where one chooses to buy a house. Partly due to the economy not being kind to everyone, many lending firms have toughened their standards therefore eliminating so many loan applicants along the way. That mentioned, the VA loan program continues to soar as a crowd favourite—a coveted loan program, even, to those who can’t apply.

As of this writing, the Veteran Affairs have now supported more than 20 million families of armed forces, and the number continues to grow by the day. For more military personnel house loan concerns, click the link!

by jkyle