VA Loan Benefits Eligibility
Establish Your VA Loan Benefits Eligibility
Recently released from the service and ready to set down roots? In the service and looking for an alternative to on-base housing? If so, learn what you need to establish your VA benefits eligibility and apply for a VA loan. You could find yourself able to qualify for a no money down, low interest rate loan backed by the government that offers many attractive benefits. The VA loan program has flexible uses and allows:
- One Veteran to use it buy a home for his or her primary residence
- Several Veterans to pull their eligibility
- An eligible husband and wife to acquire property jointly
- A Veteran and a non-Veteran who is also not a spouse to apply for a loan together
VA Benefits Eligibility Requirements
For the Veteran to qualify, he or she must meet service requirements such as 90 days active duty during wartime or 181 days active duty during peacetime. You can also qualify if you served for six years in the reserves or National Guard, or if you are the surviving spouse of a service member who is missing in action or a prisoner of war or killed in the line of duty or rendered disabled from his service.
In addition, even without meeting the minimum service requirements, you may be eligible if you were discharged due to hardship, the convenience of the government, reduction in force, certain medical conditions, or service related disability. A VALoansFinance.com specialist will be able to assess your situation and determine your VA benefits eligibility in these circumstances.
What VA Benefits Eligibility Means
Qualifying Veterans are granted an entitlement that tells a lender how much the government would be willing to back. Eligible candidates start out with $36,000 of entitlement for a mortgage of $144,000 – 25% of the loan amount. Veterans must qualify for their loan values based on credit and income like any other loan, but a highly qualified applicant could be granted a mortgage of up to $417,000 or more in some counties with an entitlement of $104,250. This includes the basic $36,000 in entitlement, plus up to $68,250 for larger loans.
To obtain a loan, the Veteran’s income and credit history are scrutinized as with any loan. If he or she were preapproved for only $200,000, that would mean that the total entitlement was $50,000, with $36,000 coming from the basic entitlement and the balance coming from the extended entitlement. This entitlement does not translate to cash in the hand, but a Veteran could use this benefit again and again to buy homes once previous loans were paid off.
Exclusive Benefits To Veterans
VA loans are reserved exclusively for Veterans, as a benefit for their time bravely serving our country. With a VA loan, Veterans have the advantage of a mortgage that comes with very favorable terms:
- No money down. This is especially convenient for current servicemembers or Veterans with stable incomes but little or no savings.
- No (or very low) closing costs. Although there are costs involved in transferring property from one person to the other, the Veteran usually does not have to pay them. Usually, either the seller or the VA assumes the costs.
- No private mortgage insurance (PMI). Ordinarily, those who put less than 20% down would have to protect the lender through additional insurance.
- Low interest rates, based on prevailing market rates.
Most Veterans must pay a VA funding fee which amounts to 2.5% for first-time users and 3.3% on second time users. Some Veterans, namely those receiving compensation for service related disabilities, those eligible to receive disability if they were not already receiving retirement pay, and surviving spouses of Veterans who died in the service or have service related disabilities are exempt from the fee. The VA makes the judgment call as to who is exempt.
VALoansFinance.com Can Help You
VALoansFinance.com can both help you obtain your paperwork quickly and guide you through the preapproval and the loan process that follows. Just visit our website for more information, as well as access to our online application form. We also invite you to contact our loan specialists at (855) 383-5002 if you have any concerns or questions about your VA benefits eligibility. We are committed to helping you establish your eligibility and quickly getting you on the road to homeownership.