How to Know if You are Eligible for a VA Loan

1. How to Know If You Are Eligible For A VA Loan Facts About VA Loan Eligibility For new homebuyers, one of the most arduous processes can be figuring out how to pay for their new house. There are many options for loans but how do you know which one is right for you? If you’re a United States veteran, a loan through the Department of Veterans Affairs is the best choice for a home loan you can make, as it is specifically designed for you and in most circumstances, requires no down payment. One can apply for a VA Loan eligibility with any lender that has a program for VA home loan. Barring a few special circumstances (discharge due to hardship, service-connected disability, surviving spouses of veterans), VA loans are for veterans, military personnel currently on active duty National Guard & Selected Reserve members. The VA website offers minimum service requirements and qualifying dates for each status. Once that has been established, and you have found a home you desire to purchase, you will need to apply for a VA Loan Eligibility certificate. Once approved, speak with a lender at a financial institution such as a bank or mortgage company. Though VA loans are meant for military personnel, that doesn’t mean you are automatically entitled to one. Just like any other loan, you will be approved or declined based on your current financial status. Factors such as a bad credit rating or a previous bankruptcy will hurt your chances for approval. If you filed for bankruptcy, that doesn’t mean you have completely forfeited your chance of being eligible for a VA home loan.

2. There are several circumstances that could have it disregarded. For instance, if your bankruptcy was discharged over two years ago, or if you have brought your credit back up to an acceptable rating and the circumstances that lead to the bankruptcy were out of your control, such as medical bills and/or being out of work. If your bankruptcy filing was discharged in the last year, then it is best to wait for another year or so. Otherwise, your lender is more likely than not to decline you. In most circumstances, there is no down payment required for a VA home loan for the property itself. However, sometimes a lender might require it. There may also be one required if the purchase payment is larger than the reasonable value of the property. Some payments are guaranteed, as there will be a VA funding fee. Required by law, the VA funding fee lessens the burden on other taxpayers for the VA home loan program. If you are applying for a VA home loan for a second time and are not making a down payment on your home, your funding fee will be higher, by a bit. The reason being that the reduced fee is more intended for first-time buyers and the time in between purchasing your first and second time should be adequate to save for the funding fee. If you are making a down payment, this can be reduced based on the percentage of said down payment. VA home loans are an excellent choice for veterans in good financial standing looking for a home.