There has been a lot of news lately about how difficult it is for a person to get a loan to finance the purchase of a home. For most people, that is true; however for qualified veterans, the VA loan has certain guarantees to the lender that make these loans more available in today’s volatile lending market. A VA loan is guaranteed by the U.S. Department of Veteran’s Affairs and for that reason; lenders who have been approved by the Veteran’s Administration currently have money to lend to qualified VA buyers.
There are several standards and periods of service one must meet to qualify for a VA loan. A professional Real Estate Agent specializing in assisting VA buyers can help you through the process and direct you to a reputable VA approved lender. Our very own, Joan Genter of The M & M Team has first hand knowledge of the VA process. Joan is a retired member of the United States Air Force, has relocated many times over the years and has purchased her personal property using the VA Loan.
The first step in becoming eligible for a VA loan is to obtain a Certificate of Eligibility from either the Veteran’s Administration or through a qualified VA lender who has the ability to obtain a certificate for you. In most cases you will need a copy of your DD214 or equivalent to prove your military service periods. When the Certificate of Eligibility is issued, it will be good for 12 months.
There are several advantages to obtaining a VA loan. VA loans allow you to purchase a property with 100% financing (no down payment) and they do not require you to pay primary mortgage insurance. Additionally, a seller can pay up to 6% of your closing costs and the loan can be written for 30 years, with a fixed interest rate. In Ventura County, effective January 1, 2009, the maximum loan amount for a VA loan will be $598,000. This makes many properties in Ventura County very affordable. One of the best advantages of the VA loan is that your credit scores are not a heavy weight for your loan qualification. What is more important to the VA is that the last 12 month period shows a clean history of paying on time. The VA also does not charge you a higher interest rate based on your credit score as most lenders do. Also, VA loans are assumable, which is a good position to be in when you are ready to sell your home as it helps buyers be attracted to your property.
Keep in mind that the purpose of the VA loan is to provide financing for your principal primary residence. These loans are provided for existing homes or new construction, not for land purchases. You can purchase a house, condominium or a townhouse; it doesn’t matter as long as you live in the property.