One of the many benefits of serving in the military is the ability to use a Veteran's Administration (VA) loan to purchase a home. The VA loan program offers more flexible home loans to current and retired service members who meet specific requirements.
#1: Start Searching for a Lender
The federal government backs up a VA loan; however, it is processed through a local lender. You will want to shop around to find a lender who is used to working with VA loans. You want to find a lender who is easy to work with and understands the VA loan requirements.
#2: Get VA Certificate of Eligibility
When it comes to going beyond the preapproval process, you will need to have a VA Certificate of Eligibility to get the actual loan process started. You don't need this to shop for a lender, but to get some work done with a lender, you will need to obtain your VA Certificate of Eligibility, so don't put this off for too long.
#3: Review Your Credit Report
Your credit score is not as important with a VA loan as it is with a traditional loan. With a VA loan, you can qualify with a lower credit score. However, you will get to enjoy lower interest rates, which will save you money on your loan's life if you have a higher credit score.
Get your credit report and check it carefully for errors. If your score isn't where you want it to be, analyze what you can do to improve your score and take steps to do so before starting the home buying process.
#4: Understand Property Requirements
A VA loan is a little different than a traditional loan. One of the requirements with a VA loan is that the home is move-in ready, determined by a set of minimum property requirements a property has to meet. If the property doesn't meet those requirements during the appraisal process, those defects will need to be fixed before you can purchase the home. The seller has to make those improvements. To make your offer more appealing, you could drop down the cost as a way of thanking the seller for making those improvements.
This requirement also means that a VA loan is usually not the appropriate loan choice, even if you qualify for a fixer-upper or foreclosure.
With a VA loan, you still want to have your credit score in order. You should take your time shopping around for a lender, and once you find a lender, be sure to get your VA Certificate of Eligibility. As you search for a property, remember that it has to meet the minimum property requirements of a move-in ready home set by the VA.
To learn more, contact a company like Lund Mortgage Team.