VA Home Loan Guide: Everything You Need to Know About VA Loans

If you are a veteran or home buyer, this article has been carefully curated to contain everything you need to know about VA home loans.
<a href=''>Anna Clement</a>
Anna Clement
August 25, 2022
4 min read

Veterans deserve a good life. Their amazing service to the country qualifies them for a good shot at living a reasonably seamless civilian life. And to effect this, the GI Bill of Rights set up the VA home loan program in 1944. The aim is to make it easier for veterans and their families to buy a home and transit without any hitch to everyday civilian life after World War II. Thus, if you are a veteran or home buyer, this article has been carefully curated to contain everything you need to know about VA home loans.

What is a VA Loan?

The US Department of Veterans Affairs backs this home loan. Now, although the US government is not the provider, they serve as a guarantor for the loan. They help the lender to have a soft landing if the home buyer defaults on the payment. In such cases, they repay a portion of the VA loan to the lender. Like any other loan, private lenders such as banks, credit unions, or mortgage companies issue VA loans. And this type of loan makes it very easy to acquire a home because you do not need a down payment to secure it.

How does a VA Loan work?

So, how does a VA home loan work? The major distinction with a VA loan is that the government pays back a part of the loan if the veteran who secured it is unable to meet up with payments. Thus, lenders have lesser risk. In turn, they can offer more favorable terms with the loan. And ultimately require no down payment.
You should note, however, that not all lenders offer VA loans. Some simply service VA loan borrowers. Thus, you could apply for a loan with your chosen lender.

Who is eligible for a VA loan?

  • If you are in active military service
  • If you are a veteran with the required length-of-service requirements 
  • If the building you want to buy would be your permanent residence. It also has to meet minimum safety guidelines
  • If you were married to a service member who died in active service and you have not remarried
  • If your income and credit qualify you for the loan

What are the benefits of a VA Home Loan?

  • No Mortgage Insurance

Wondering what the benefits of a VA home loan are? A major one is that you do not have to worry about mortgage insurance. Usually, other loan types require you to pay mortgage insurance if the down payment is less than 20%. However, neither down payments nor mortgage insurance are required in VA loans. 

  • Considerable Interest Rates

ICE Mortgage Technology, a reliable mortgage data provider, shared that VA home loans had lesser interest rates for mortgages averaging 30 years. This is compared to FHA loans. 

  • Mitigated Loan Costs

According to the Department of Veterans Affairs, the lender has a limit of 1% of the loan amount to charge on the origination fee. Also, other closing costs have been halted to accommodate a more comfortable loan experience. 

How to apply for a VA Home Loan

If you have been wondering, ' how do I get a VA home loan?' Well, here you go. 

  • Certificate of Eligibility

To show that you qualify for the loan, you need a VA-approved certificate to show that your military service meets up with the eligibility guidelines. 

  • Picking a Choice Lender

The trick here is to get pre-approved with several VA mortgage lenders. This will help you to compare their requirements and rates. Thus, you can make a more informed choice of which lender to choose. 

  • Picking the Home to Buy

Ensure that the home you want to buy is clean and secure. And most importantly, it has to be structurally fit. After this, put an offer on the house. 

In conclusion, a VA loan is designed to make getting your desired home a reality as a veteran. So, take advantage of it today and easily move into your dream house.

You might also like
December 13, 2022

USDA Home Loan: What it is, How it Works, and How to Apply

To know how to apply for a USDA home loan, read this article until the end.

3 min read
October 12, 2022

A Complete Guide to the Rate and Term Refinance

In this article, you will learn how the rate and term refinance works, what it entails, as well as how you can apply for one.

4 min read
September 20, 2022

What are Home Mortgage Closing Costs?

Are you closing in on that home of your dreams? Congratulations. However, it’s important not to make the same mistake most home buyers make at the final moment.

3 min read