VA Home Loan Purchase: The VA purchase program allows eligible homebuyers to finance up to 100% of the purchase price. Since the end of many down payment assistance programs, the VA loan program has become one of the last remaining 100% home loans in the nation.
With many conventional loans now requiring a 5-20% down payment, the Veteran’s Assistance home loan is a great choice for homebuyers with limited or no down payment. The best part of the program is NO monthly mortgage insurance charge. Below we will discuss some program benefits and things applicants should know about eligibility. The information below will help you better prepare for the loan application process.
VA Mortgage Program Benefits:
- 100% financing home purchases: Most conventional lenders require at least a 10% down payment which is not possible for many Veterans and military families. FHA requires a 3.5% down payment and has very high monthly mortgage insurance. Because the program is guaranteed to the lender or bank (by the Veterans Administration) they do not require a down payment.
- NO mortgage insurance (PMI): Even with a $0 down payment, a VA Mortgage does not have mortgage insurance (PMI) as part of the monthly payment. Conventional programs with less than 20% down and FHA both have expensive mortgage insurance that can cost buyers several hundred dollars every month.
- Low-interest rates: Because the program is backed by the Department of Veterans Affairs, the risk level associated with default is much lower. As a result, VA interest rates are usually lower than a conventional program with less than 20% down. FHA and USDA loans are also backed by the government and have similar interest rates.
- Just about any home is eligible: The mortgage can be used for any HUD compliant single-family home, townhome, or condo. All properties must meet the basic HUD standards in regard to condition and safety. All government mortgage programs like VA, FHA, and USDA follow similar property condition guidelines. The home seller can be anyone – bank-owned REO, foreclosure, short sale, or “buy owner” type of seller. The property must be a primary home, no investment home purchases are permitted. Please note we do not offer financing on mobile or manufactured homes.
- Easy qualifying criteria: Guidelines are more flexible than many other loan programs. Since the program is guaranteed by the government, most lenders have lower credit requirements, making them easier to qualify. The current minimum credit score requirement for most lenders is 600.
- VA Jumbo Mortgage: High-balance VA loan options up to $4mil are now available to buyers with full entitlement.
VA Loan Eligibility:
VA home loan eligibility can be established for U.S. service personnel currently on active duty or honorably discharged when minimum service requirements are met. Eligibility can be earned by serving in any branch of the US military – Army, Navy, Air Force, Marine Corps, Coast Guard, Reserves, or National Guard. You are likely eligible for a VA loan if you served the following:
- 90 days and are currently on active duty.
- 181 days during peacetime
- 6 years in the National Guard or Reserves.
- If you are an unmarried surviving spouse.
Please note: Just because you are eligible for VA mortgage benefits does not guarantee VA mortgage approval. Applicants still must meet all lender qualifying requirements in regard to credit score, debt, income stability, etc.
VA Loan Amount, VA Purchase Price Limits:
Starting in 2020, VA has no loan limits for most users of the program. However, many lenders and banks can have in-house overlays to limit mortgage amounts to the conforming loan cap. As of 2023, loans up to $2mil are available with no down payment. Higher loans up to $4mil are also permitted with a small down payment. *Restrictions apply to borrowers that have more than one active VA loan or have defaulted on a previous loan.
DD-214 for Veterans:
Your DD-214 is required on the VA Home loan because it lets the lender what type of discharge you had from the military which will determine if you are eligible for VA mortgage benefits. If you are currently on active duty this does not apply. If you have misplaced your DD214, you can order one from the Veterans Archives website at http://www.archives.gov/veterans/military-service-records/ It is a good idea to have your DD-214 before applying for your VA home loan. Not having this form in advance can delay your home purchase until received. If you have questions or need help, please reach out to us by submitting the short info request form on this page. We are always happy to assist you.
VA Certificate of Eligibility (COE):
The VA Certificate of Eligibility causes some confusion for Veterans when attempting to use their VA home loan benefits. The Certificate of Eligibility (COE) form is designed to tell both lender and the Veteran that they have sufficient entitlement/guarantee to use their VA loan benefits.
If you want to purchase a home using a VA loan, you must prove that you have the military service to qualify for this benefit. That proof of qualification is the certificate of eligibility or “COE” You’ll also need a COE to refinance from a conventional to a VA loan (but not for a streamline/IRRRL refinance).
The easiest way to obtain your certificate of eligibility is for us to do it for you. Mortgage lenders use an online system to get your certificate in minutes. If this system doesn’t contain enough data to establish your VA loan eligibility, you can apply manually. This can be done online, by phone, or by mail.
To apply for your VA Certificate of Eligibility, please contact us directly by submitting the quick info request form on this page, we are happy to assist.
VA Mortgage Funding Fee 2023:
Please note the VA funding fee is paid on all purchase and refinance transactions with the exception of certain disabled Vets. The funding fee is paid directly to the Department of Veterans Affairs so eligible military and past veterans can take advantage of 100% financing. Below we have outlined the Current VA funding fee chart as of April 2023.
NOTE: Veterans who qualify as 10% disabled or greater as a result of active military service are NOT required to pay a funding fee. Those who are not exempt from a funding fee may lower their fee by putting money down on their VA home purchase. For all VA home loans, the funding fee may be paid in cash or it may be rolled into the loan.
Please call us with questions 7 days a week at Ph: 800-743-7556. You can also expedite your request by submitting the information request form on this page. We typically respond to all submitted request forms within 10 minutes during regular business hours.