Here are some insights into obtaining a VA loan. Below you will discover the steps and eligibility requirements for this awesome home loan program. One important standard to meet is being a veteran. If that is you...read on.
If you have served in the Armed Forces in the United States then you may be eligible for the VA Home Loan Program that is administered by the Department of Veteran Affairs.
In order to apply you
generally (though not always) have to fill in a request form on their
website for a certificate of eligibility.
Below I have a link to take you directly to the form necessary to get this certificate. In the meantime here are some other requirements you may want to become familiar with.
Take a look and see if you meet these basic eligibility requirements:
There are many more specifics on the Veteran Affairs website, but the question you may be asking is why is the VA Home Loan Program, in any case, a good idea?
The main reason is that the loans are backed by the Government, so the normal guarantees and financial hoops that a financial institution would make you jump through to get a loan no longer apply.
If you don't pay back the loan, the government will. So it removes all the risk of the transaction from the financial institution, and means that the interest rates you will have to pay for any loan will be lower.
The reason for this is that anyone who is eligible and who is going about obtaining a VA loan is automatically a better candidate for the banks because they represent a "cannot lose" loan.
So all of the banks are literally tripping over themselves trying to outdo each other in offering preferential interest rates on their home loans to make sure that they attract as many of these top-caliber clients as possible.
Additionally, it means that you can secure up 103.15% financing, which is almost unheard of for normal loans without substantial guarantees.
The only disadvantages to a VA mortgage are that first, whilst there isn't a limit as such on the cost of the home you choose to buy, that there is a maximum amount that the Government will cover under the VA Home Loan Scheme which as-of Jan 2011 was $417,000.
Second, you do have to pay a funding fee of up to 3.15% to the Department of Veteran Affairs, so there are some administrative charges to take into account.
On balance though the VA Home Loan Program offers a great opportunity to get financing for your home at a very favorable interest rate, so if you are eligible, it is well worth looking into obtaining a VA loan.
Would you like to see the certificate of eligibility form? Form 26-1880, Request for a Certificate of Eligibility for VA Home Loan Benefits (be sure to type in 26-1880 to see a copy of the form).
If you have any other questions concerning this type of program, do not hesitate to ask your question here.
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