VA home loans prove to be an advantage if you are eligible for one. This loan program was started in 1944 helping returning servicemen in buying their own homes. Serving the military offers many advantages, including finding it easy to get a home loan with 100% financing.
How does it work?
The application process for VA financing is actually the same as with many other mortgage loans. In fact, the VA application form is the same as that used for HUD/FHA and conventional loans. The mortgage lender verifies the applicant's income and assets, and obtains a credit report. Even if you have a poor credit rating, you can still be eligible for a VA home loan.
The lender first analyzes your credit history to find out if you have been making all your credit and utility payments on time. And even if you have been delinquent in your payments, you can work things out with your lender and at most, you may have to make a down payment for the loan.
Are there any fees?
There are no expensive fees to be paid for the processing of the loan. However there are some associated costs you have to pay like appraisal fees, compliance costs and recording fees. For all VA home loans, the funding fee may be paid in cash or it may be included in the loan.
It is important to recognize that while the VA appraisal estimates the value of the property, it is not an inspection and does not guarantee that the house is free of defects. Home buyers should hire a reputable inspection firm to conduct the inspection.(Fees can vary) VA guarantees the loan, not the condition of the property.
The appraised value of the property needs to be enough to cover the loan needed. The lender can then, in most instances, close the loan under VA's automatic procedure. Only about 10 percent of VA loan applications have to be submitted to a VA office for approval before closing.
Who is Eligible?
If you have been honorably discharged from the military then you are likely eligible for the loan. There are other requirements you have to fulfill for the loan, which vary with whether you served full time or in the reserves. Contact the local VA office near you to find out exactly what documents you will need to establish your eligibility.
Sandra Eriksen is the owner of many websites devoted to sharing valuable information. For more articles and resources on different types of mortgages and loans please visit her site at [http://www.loaninfosecrets.com]
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