VA Mortgage Loans
VA Mortgage Loans and VA Mortgage Loan Refinancing
You may have joined the military to protect your country and see the world, but there comes a time in life when you want to settle down and buy a home. A VA mortgage loan will help you do that without having to come up with much money out-of-pocket to make your purchase.
Accessing your VA mortgage loan is a five step process with the keys to your new home waiting for you at the top. Working with a VA-approved lender like Capital Bank, N.A. ensures the climb is easy.
The Five Steps To Home Ownership With A VA Mortgage Loan
When you are ready to buy a home, there are five steps you need to complete.
- Apply for a Certificate of Eligibility
- Obtain prequalification from an approved VA lender
- Find a home and complete a purchase agreement.
- Order an appraisal from the VA
- Close on your loan and move-in
Let’s Look At Each Step Of The VA Mortgage Loan Process
- Determine Eligibility: Before anything else, you must first obtain your Certificate of Eligibility from the VA. Known as a COE, this form is used in conjunction with the form DD-214 to show the details of your service and discharge. You can apply online, which is easy, but it takes six weeks or so to get a reply. Capital Bank, N.A. can obtain this document for you in minutes by accessing the VA online database.
- Obtain Preapproval From A Lender: The next step of prequalification verifies that a lender is willing to offer you a VA mortgage loan and for how much. Even a VA mortgage loan is underwritten by a bank or other private lender: the VA just guarantees up 25% of the loan. To prevent this step from becoming a roadblock, you need to have good credit. At Capital Bank, N.A., we will help you through the prequalification process. We can give you advice about how to improve your credit and how various income, debt and credit factors affect your qualification.
- Find A Home: Next, you find the home of your dreams that is affordable and within the budget the lender has set for you. When you or your Realtor® negotiate a price, you should consider potential closing costs. Although the VA has a cap on certain costs, there are others that you or the seller must assume. If you want the seller to pay all or part of these costs, you should ask as part of your offer. A seller may not agree to all your request, but you can adjust your offer price enough to cover the costs. That way, the seller technically “pays” for things that you have wrapped into your mortgage.
- VA Appraisal: Once you have found your home, you, or most likely your lender, will order an appraisal from the VA. Since the VA wants you to buy an affordable home, they will only extend VA mortgage loan terms on a home that appraises at or above the selling price. If the home comes under the selling price you can renegotiate with the seller or request an additional appraisal. Alternatively, you can agree to the higher price but you must come up with the difference between the appraisal value and the selling price out-of-pocket.
- Close And Move In: Once all the hard work is done, you sign the closing documents, pay any closing costs not handled by the seller or included in your mortgage, and move-in.
Climbing The Hard Steps
Steps one and five of this VA mortgage loan process are the easy ones, while the middle three steps can be confusing to navigate, particularly for first time homebuyers. If you don’t find the house you want at the price you can pay or if your credit score limits your budget, you may feel you are back to square one. What can you do in this case?
- Wait until the house you want or can afford hits the market. Many times your Realtor® will keep his or her eye open and let you know if something new becomes available.
- Come up with money out-of-pocket. Although your VA mortgage loan does not require a down payment, putting money down can put a home out of your price range within reach.
- Save some more money. While this can be painful news if you want to buy a home now, waiting until you have put more money aside can lower the amount of the mortgage or help you qualify for a more costly home.
- Clean up your credit report. If you have had bankruptcies or recent delinquencies, you may need to establish a year or more of good payments. Other credit problems can be solved with a few months of on-time payments. Capital Bank, N.A. can guide you in this area or may show you other loans you can qualify for with lower credit scores.
Capital Bank, N.A. Is On Your Side
Capital Bank, N.A. wants to put the keys to your new home in your hand. We will not only help you establish your eligibility for a VA mortgage loan, but we can guide you as you apply for prequalification and through each and every step in the process. Just contact our helpful loan specialists at (866) 216-3577 and start climbing the steps to homeownership today.