If you’re a veteran interested in purchasing a home, think about applying for a VA loan from the Veteran’s Administration.
What is a VA loan?
VA loans are home loans for the purchase of a primary residence available to consumers who have served or are presently serving in the U.S. military. While the Department of Veterans Affairs (VA) does not lend money for VA loans, it backs loans made by private lenders (banks, savings and loans, or mortgage companies) to veterans who qualify.
Who Is Eligible for a VA Loan?
- Veterans
- Active-duty personnel
- Reservists/National Guard members
- Some surviving spouses
The advantages of a VA loan are:
- You can get a VA loan with no down payment required (unless required by the lender or the purchase price is more than the reasonable value of the property).
- They are available from most lenders.
- The government limits the amount of closing costs and origination fees lenders can charge, as well as appraisal fees.
- The VA prohibits lenders from requiring PMI (private mortgage insurance).
- Right to prepay without penalty.
- VA assistance to veteran borrowers in default due to temporary financial difficulty.
Are there restrictions on what I can buy?
Generally you can buy a single family home without problem, however, condos have to be approved by the VA. If the condo you’re thinking of purchasing isn’t approved by the VA, your Realtor and mortgage lender can try to get the condo on the VA approved list, as long as the seller and the building’s HOA agree to participate in the process. This is why it’s important to have a great Realtor representing you who has helped clients purchase homes with VA loans before as well as a mortgage officer who understands the VA loan approval process, especially if you’re thinking of buying a condo which isn’t already VA approved.
What do I need to do?
First, I’d recommend working with a mortgage loan officer who understands and specializes in VA loans.
Second, I’d contact the VA asap and request a copy of your Certificate of Eligibility and your DD214. These are often the documents that hold up VA deals so the earlier you can request them, the better.
Third, if you’re buying a condo it’s important to know that the building where the condo is located has to be an approved VA building. If the building isn’t approved, your mortgage lender can get it approved, but it takes approximately 60 – 90 days and can be an arduous process which is why it’s important to have a really good mortgage lender as part of your home buying team.
Lastly, don’t forget that your condo or home needs to have a termite inspection done as most agents don’t know or forget this and it can really mess up your transaction!
For a general overview of VA loans click here
For general information on VA loans click here
For a list of FAQ about VA loans click here
To see a list of approved condo buildings click here
