VA Loans

VA Loans - VA loans often are accompanied by a VA Funding Fee, typically in the range of about 3.3%, and usually have a maximum LTV of around 90%. VA loans are especially beneficial in the case of a first time homebuyer purchase since "no down payments" are typically part of the program, and if the veteran still has their full VA entitlement, the VA status loan can be a great option. However, in the case of a refinance, it is advised that the customer weighs the option between a VA and a conventional loan, considering the VA Funding fee and what is left of their VA entitlement, to see what is in their best financial interest.

In most cases, your mortgage professional will be able to find a program for you that fits your needs as well as, or even better than, a VA loan would.

Typically, a borrower must be at least 2 years removed from any bankruptcies to qualify for a VA loan.

VA Home Loan - Is It Right For Me? - A VA loan is a mortgage available to most veterans, that is guaranteed by the Department of Veterans Affairs. While it is not the best choice for all veterans, there are some wonderful benefits including no mortgage insurance requirements, and no down payment in many cases.

Make sure that your attorney places a VA option clause in your purchase contract. This clause will allow you to "escape" from the contract without penalty if you are unable to obtain a VA loan or if the property does not meet VA guidelines.

Veterans who qualify as 15% or more disabled from the VA do not have to pay a funding fee. The VA is a great program for first time buyers and those with some minor blemishes on their credit.

There are pros and cons for the VA loan program. Be sure to ask your mortgage professional if they offer VA financing. Many who do not offer or understand VA financing may try to dissuade you from taking a VA loan.

Ask your mortgage broker the pros and cons of the VA mortgage in comparison to a standard conforming mortgage loan.

VA loans require special appraisals and flaws with the house most be fixed before closed. If they are not fixed before close sometimes it can be arranged that the costs of repairs will be escrowed into an account by the sellers.

If you decide that a VA loan is right for you, then you will need to apply for a Certificate of eligibility. If you do not have one, then you need to complete VA Form 26-1880 and submit it to one of the Eligibility Centers with copies of your most recent discharge papers.

One of the downsides of a VA loan is that there a funding fee which is charged as a percentage of your loan amount. The funding fee will vary depending on if you were on active duty, or in the reserves, and also based on the number of times you have used your eligibility. If you are receiving any service connected disibility payments you will not be charged the VA funding fee.

VA - Department of Veterans Affairs: a federal agency which guarantees loans made to veterans; similar to mortgage insurance, a loan guarantee protects lenders against loss that may result from a borrower default.

It is important to recognize that while the VA appraisal estimates the value of the property, it is not an inspection and does not guarantee that the house is free of defects. Homebuyers should be encouraged to carefully inspect the property themselves, or to hire a reputable inspection firm to help in this area. VA guarantees the loan, not the condition of the property.

If you receive a Veterans disability benefit or allotment, there is a good chance that the funding fee will be waived.

VA loans closed after 1988 are assumable, with approval of the VA or the Lender. Loans closed before 1988 are assumable by anyone, without any approval. The owner should get a release of liability before allowing the mortgage to be assumed.

Although rare, the VA will do a "refund" of the loan, from the lender. If the veteran is having difficulty making payments, the VA will "refund", which means they will take over the loan. This is only done when the veteran's reasons were due to circumstances beyond his or her control, and there is a good chance that they will recover and be able to make timely payments again.

A VA loan refinance, is called an IRRRL. An "Interest Rate Reduction Refinance Loan" is also referred to as a "Streamline" or "VA to VA". Unless you are refinancing from an adjustable rate, you must be moving to a lower rate, from your existing mortgage rate.

No appraisal or underwriting is required for the IRRRL by the VA, but the lender may want an appraisal and credit report. An IRRRL can be done with no out of pocket expense and does not require the VA certificate of eligibility.

The veteran will need to provide their Certificate of Eligibility, the certificate is VA form 26-8320.

Also, it is possible for a veteran to have more than one VA loan.

The VA home loan benefit is called an entitlement.

VA guaranteed loans are made by lenders and brokers to veterans for the purchase of a personal home. The guaranty means the lender is protected against loss if you fail to repay the loan. The guaranty replaces the protection the lender normally receives by requiring a down payment allowing you to obtain favorable terms.

The guarantee is called the VA Funding Fee. It's a percentage of the loan amount and can either be paid at closing or added to the loan amount.

With a VA loan you finance 100% of the purchase price as well as the funding fee.

Although you are paying for the funding fee you are getting a lower rate in exchange. This means over the life of your loan you could save thousands of dollars over other conventional loan programs.

A note to the borrower:

There is usually quite a bit more paper work involved in processing a VA loan. There are extra disclosures that need to be signed along with stricter underwriting guidelines. They may require letters of explantions for various items on credit reports etc...

FHA or VA Loan For First Time Home Buyer Home Loan - If you are a veteran and are buying your first home you have many different choices when it comes to home loans. Both FHA and VA offer great first time home buyer loans to veterans. What home loan is better for the first time home buyer FHA or VA?

Both FHA and VA loans can be scored through Automated Underwriting Systems.(AUS) Your mortgage professional can score you through both types and give you a comparison of your payments, etc.

VA loans currently have a higher maximum loan amount at $417,000. FHA loan limits vary by county and range from $200,160 to $362,790 for single family homes. Consult with your mortgage professional at 414-303-1215 to see which program best fits your needs.

Both FHA and VA loans have a financed Mortgage Insurance Premium. For FHA, this is referred to as your Mortgage Insurance Premium (MIP) and for VA loans it is called a Funding Fee. The VA does not charge a monthly mortgage insurance premium and FHA uses has a .5% monthly MI premium. These fees often work out to be significantly cheaper than conventional financing MI premiums.

As a veteran, in some cases, you can only use your VA letter one time to obtain a VA loan.

Benefits of VA Loan Financing - If you are a Veteran, a VA Loan may be a great fit for you to purchase a home. The VA guarantees a portion of the approved Loan, making it easier for a lender to extend credit. There are many benefits to using your VA Entitlement to obtain mortgage financing.

VA Loans may be used in refinance situations up to 90% of the appraised value.

VA Loans are assumable and do not have prepayment penalties. You may refinance or sell your home at any time during the mortgage.

VA Loans can be used for simultaneously purchasing and renovating a home.

VA loans currently allow for 100% financing for loans up to $417,000. There is no monthly mortgage insurance charge for VA financing. A one time VA funding fee is allowed to be financed into the loan amount.

Veterans from world war II to present can qualify for a VA loan as long as their discharge was honorable. Reservists must have 6 years of reserve service and either be still enlisted or have an honorable discharge. Reservists may pay a slightly higher funding fee then active duty applicants.

VA loans can still be used for purchasing a manufactured home if within HUD guidelines.

VA loans allow for up to a 6% seller concession on a purchase. The seller concession can even go towards paying down your current debt in order to help you qualify.