Getting a VA home loan is pretty much as easy -- or as difficult -- as getting any other sort of mortgage. There are offers to compare, paperwork to complete and documents to produce -- but the advantages of a VA home loan make worth whatever hassle is involved. VA is the only loan program that allows 100 percent financing and does not require mortgage insurance. VA loans are also assumable and there are no loan limits.
Eligibility is key. Chances are, if you think you qualify, you do. But it's worth checking the detailed criteria on the U.S. Department of Veterans Affairs' website, which also describes the evidence you'll need to support your application for a Certificate of Eligibility (COE). That page provides dates and minimum periods of service for serving personnel, veterans, National Guard and Reserve members, along with information for surviving spouses.
It also lists others who may be eligible, including (who knew?) Public Health Service officers and officers of National Oceanic & Atmospheric Administration.
Once you've established that you're eligible, and have got together the evidence you need, you have to apply for that Certificate of Eligibility (COE). You can do that online through the VA's eBenefits portal, by asking your lender to get you one (see below) or by mail.
Want a short cut? Chances are good that if you're eligible and in the VA's database, your VA lender can get your COE for you, almost instantly, through the VA's WebLGY portal.
A VA home loan tends to be easier to qualify for than many others, but you're still likely to need a reasonable credit score and sufficient income to cover the new mortgage and other regular commitments while still being able to live.
In addition to your qualifying personally, you need to ensure that the home you want to purchase or refinance is acceptable. Again, these are generally undemanding conditions that are likely to bother few applicants. However, owner occupancy is a standard condition, so you have to live in the home yourself.
You can use a VA loan to:
- Buy a home, including a condominium that's part of VA-approved project.
- Build your own home (Not necessarily personally: You can pay contractors to do the work!).
- Buy an existing home and pay for it to be done up.
- Buy a manufactured home. Optionally, you can also use the loan to buy the lot on which that home stands.
- Pay for energy-related home improvements.
Generally, the properties supported include single-family homes (including VA-approved condominiums), townhouses and multi-family homes up to four units. Watch out for other rules, but these are likely to apply in only relatively few cases. Obviously, the property you choose must also have an appraised market value sufficient to cover the loan. Grants to adapt housing to meet particular needs are available to those with service-related disabilities.
Choose a Lender
The VA doesn't actually lend you any money. Instead, it guarantees the loan you get from a private lender. That means it's up to you to pick a good one.
Your main priority is likely to be getting the best mortgage rate. But it's also important that you find a lender that's going to be helpful, easy to work with and that has a reputation for great customer service. LendingTree provides Lender Ratings, a great resource that lets homeowners rate and comment on their lenders, so you can check out the ones you're considering while you're shopping around for the best deal.
Complete the Application
Completing a mortgage application is not hard because most lenders employ processors to help you. The lender then checks your credit, verifies your income, processes the application and orders an appraisal of the property. You'll have to provide documents that prove your income and verify your assets, so it might be worth collecting bank statements, pay stubs and other relevant paperwork now.
Once your loan is approved, you'll sign your closing documents. That's when the property's ownership is transferred to you, and you can move in.
Now you know how to apply for a VA home loan. It's not hard. Just remember when times get tough how happy you'll be when you first walk through your own new front door.