Every mortgage loan program is designed with a purpose to fulfill and not every mortgage program is suitable for all borrowers. The VA home loan was established to assist Veterans and Active duty servicemembers in the military to become homeowners.
With mortgage eligibility requirements making it so difficult to obtain a mortgage loan in the past, the Department of Veteran Affairs (VA) has made it a lot easier for Veterans and servicemembers with a less than favorable credit score to get approved for a mortgage.
2015 VA Home Loan Eligibility Requirements
The VA has been helping members of the military with home buying since 1944. Today, of all mortgage purchase shares, there is an estimated share of 20 million mortgages in existence today under the VA mortgage program.
The VA mortgage program guidelines are:
- A total of 90 consecutive days as an active duty servicemember during one of the war eras.
- A total of 181 consecutive days as an active duty serveicmember during peacetime.
- A completion of at least six (6) years in the National Guard or Selected Reserves.
The VA also requires a Certificate of Eligibility (COE), which can be obtained by submitting the VA Form 26-1880. This form is a request for your COE for home loan benefits with from the Department of Veteran Affairs. Once you have completed this form, you must also provide a few other military service documents prior to a VA mortgage loan approval.
A VA-approved lender may be able to help you request for a COE along with all other military documents that you may need, by simply letting them know.
Benefits of VA Home Loan
The VA mortgage loan program usually offers some of the lowest rates to its borrowers. Not only are their interest rates competitive, but a few other benefits include:
- No Down Payment
- No Prepayment Penalties
- Caps on Closing Costs
VA home loans may be used for several types of property, such as:
- Finance on a home or a condominium as long as it is located in a VA-approved development
- A newly built home
- Renovate on a VA-approved home
- Add on energy efficient appliances
- Manufactured home or lot
All properties purchased under the VA must be occupied as a primary residence.
Note: All active duty servicemembers and Veterans with a discharged status must not fall under the status of dishonorable discharge.
With highly favorable lending terms and low interest rates, the VA home loan program has definitely allowed for military personnel to take advantage of some of the lowest rates around.
The term “Veterans” according to the VA Home Loan Program, usually can include members of the Selected Reserve, Active Duty Military Personnel, and even some categories of spouses. The VA Home Loan Program is certainly one of the many great types of benefits earned by Veterans and eligible service members.
According to the VA, borrowers must have sufficient credit, adequate amount of income and a valid Certificate of Eligibility (COE) in order to be considered eligible for the VA Home Loan Program.
Restoring Your VA Entitlement
Entitlement with the Department of Veteran Affairs may be restored as long as:
- The previous mortgage loan purchased under VA has been paid in full and the property must already be occupied by new owners.
- An approved buyer with a Veteran status must assume the VA mortgage and have transferred their entitlement over for the equivalent amount of which the original entitlement was used to purchase by the previous buyer.
All remaining entitlement or restoration of entitlement must be requested through the VA’s eligibility center by filling out the VA Form 26-1880 to get started.