VA loans are a mortgage option issued by private lenders. They are partially backed, or guaranteed, by the Department of Veterans Affairs. VA loans represent the most powerful lending program on the market for the majority of military borrowers. Those eligible for a VA loan can use it to purchase property as their primary home residence.
The most attractive quality is that they are flexible and have no down payment. Since its creation in 1944, it has helped more than 24 million service members to achieve homeownership. Across the states, there are millions of veterans unaware of the benefits of having a VA loan.
Understanding the benefits and quirks of the program can be challenging. Even seasoned VA borrowers and real estate agents still struggle. Here is a guide into how to get and use a VA loan to buy a house.
Start By Getting Prequalified And Preapproved
Choose a vendor and prequalify to receive an estimate for a house cost you can afford based on your income, credit, entitlement, and other financial factors. Getting prequalified is the first step as it leads to the next step, which is preapproval.
VA loan preapproval is a vital step in the process. Lenders will verify the income and all financial information to gain a clear understanding of an individual’s purchasing abilities. A preapproval letter is sent and can be used as proof to show real estate agents and home sellers that you are a serious buyer, looking to close a deal on a property.
Place An Offer And Close The Deal
After finding the ideal VA loan approved home, put in an offer, and negotiate a contract with the seller.
There are various legal documents and paperwork to be completed during the loan closing before you receive the keys to your new home.
There Is A Refinance Option
A VA refinance is a new loan, not an adjustment of a current one. The answer to ‘can you refinance a VA loan?’ is yes. There are multiple different refinance options available, as highlighted by Hero Loan, which includes a cash-out refinance and a streamlined refinance.
Not All Houses Included
A VA loan will not cover the cost of purchasing a working farm, a business or a home that requires serious maintenance to be livable. It is designed for properties that are considered to be move-in ready conditions. For example, properties that are modular housing, condos, family home and multi-unit properties.