Everything You Want To Know About VA Loans

If you’re a veteran interested in purchasing a home, think about applying for a VA loan from the Veteran’s Administration.

What is a VA loan?

VA loans are home loans for the purchase of a primary residence available to consumers who have served or are presently serving in the U.S. military. While the Department of Veterans Affairs (VA) does not lend money for VA loans, it backs loans made by private lenders (banks, savings and loans, or mortgage companies) to veterans who qualify.

Who Is Eligible for a VA Loan?

• Veterans
• Active-duty personnel
• Reservists/National Guard members
• Some surviving spouses

The advantages of a VA loan are:

1. You can get a VA loan with no down payment required (unless required by the lender or the purchase price is more than the reasonable value of the property).
2. They are available from most lenders.
3. The government limits the amount of closing costs and origination fees lenders can charge, as well as appraisal fees.
4. The VA prohibits lenders from requiring PMI (private mortgage insurance).
5. Right to prepay without penalty.
6. VA assistance to veteran borrowers in default due to temporary financial difficulty.

Are there restrictions on what I can buy?

Generally you can buy a single family home without problem, however, condos have to be approved by the VA.  If the condo you’re thinking of purchasing isn’t approved by the VA, your Realtor and mortgage lender can try to get the condo on the VA approved list, as long as the seller and the building’s HOA agree to participate in the process.  This is why it’s important to have a great Realtor representing you who has helped clients purchase homes with VA loans before as well as a mortgage officer who understands the VA loan approval process, especially if you’re thinking of buying a condo which isn’t already VA approved.

For a general overview of VA loans give us a call 515-249-5560