| VA loans are a type of financing available to veterans | | | | for the loan, it is time to get pre-approved. Once an |
| and men and women currently serving in the military. | | | | applicant is pre-approved for a loan, he or she should |
| These loans offer several benefits, including low | | | | begin their house search, if they haven't already. An |
| interest rates, no down payment requirement and no | | | | applicant should decide what features he or she wants |
| mortgage insurance! With this type of loan, borrowers | | | | in a house and realistically determine what is affordable |
| can finance their homes in a more cost-effective way. | | | | for his or her budget. Speaking with a loan specialist |
| Learn about the steps involved in applying for a VA | | | | about loan terms and rates can help an applicant |
| loan to be better prepared for the purchasing or | | | | decide what options are best for his or her financing |
| refinancing process. | | | | needs. |
| Determine Eligibility | | | | For a final loan approval, there is certain documentation |
| Before applying for this loan, an applicant should | | | | that the lender will need to have. This documentation |
| determine if he or she is eligible for the financing. There | | | | includes a month's worth of consecutive pay stubs, |
| are different eligibility requirements that must be met. | | | | copies of W2s from the past two years or tax |
| Applicants must meet certain service length | | | | returns, proof of insurance, certificate of eligibility and a |
| requirements, which vary depending on when they | | | | purchase contract, if available. Before the home is |
| served in the military and whether or not they serve or | | | | purchased, a VA-approved appraiser will do an |
| have served in the Reserves. If an applicant is a | | | | appraisal to determine the home's value. Once the loan |
| veteran, he or she must have been discharged from | | | | is processed and closed, the homeowner will usually |
| the military under conditions other than dishonorable. If | | | | have about a month before they will start making |
| a veteran was disabled as a result of his or her | | | | payments. |
| service in the military, there may be additional loan | | | | Make the Most of The Loan |
| benefits available to him or her. | | | | The aforementioned steps apply to purchasing a |
| Applicants must also meet certain credit and income | | | | home, but the steps to refinancing with a VA loan are |
| requirements for this loan. The VA does not require | | | | fairly similar. When refinancing his or her loan, a |
| that applicants have a high credit score, but they want | | | | homeowner needs to decide what he or she wants to |
| applicants to have a clean credit history of at least | | | | get out of the refinance. A homeowner may refinance |
| twelve months. Most lenders will only accept credit | | | | to consolidate debt, obtain a lower interest rate, |
| scores of at least 620. The maximum debt-to-income | | | | change the terms of the loan or obtain cash. The |
| ratio that an applicant can have is 41%, which means | | | | homeowner can discuss his or her options with a loan |
| your total monthly expenses must be less than or | | | | specialist to decide what type of refinance loan is best |
| equal to 41% of your gross monthly income. Applicants | | | | for his or her situation. |
| must also meet a minimum residual income (the | | | | Being educated on the process of getting a loan can |
| amount left after paying all monthly expenses), which | | | | make the process smoother and more efficient |
| varies based on one's family size and geographical | | | | because the applicant is better prepared. Applicants |
| location. | | | | who want to purchase or refinance with a VA loan |
| Obtain Pre-Approval for the Loan | | | | should speak with a loan specialist to learn how to get |
| Once an applicant determines that he or she is eligible | | | | started. |