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Considering A VA Mortgage To Purchase A Single Family Home Loan? Helpful Information Buyers Need Know

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Designed to make home ownership easier and more affordable for military families, the VA mortgage can be an excellent financing option for those who meet the qualifications. Guaranteed by the Department of Veterans Affairs (VA), each home loan is made through a bank or private mortgage lender. Because these mortgages do not require borrowers to use a down payment or pay private mortgage insurance (PMI) costs, successful applicants often find them to be a very affordable way to purchase a home. If you are considering the use of a VA home loan to purchase a single family home this year, this information will help to answer any questions you may have about the process. 

Qualifying for a VA home loan

VA home loan applicants must fall into one of these categories:

  • active duty military (after six months of qualifying service)
  • veteran of the military
  • a reservist or National Guard member (either as non-active duty members with six years of service or active duty after 181 days of service)
  • spouse of a military member who lost their life while serving in an active duty scenario or as a result of any service-related disability

During war time and some other circumstances, certain requirements may change, although all successful applicants will need to obtain a formal certificate of eligibility before applying or during the pre-approval process. 

Some fees apply

While having no requirements for a down payment or PMI insurance can help borrowers save money on the purchase of a home, there is a one-time funding fee that borrowers will have to pay.

Currently, this fee is set at 2.15 percent of the loan amount for for first time VA borrowers who do not choose to make a down payment and 1.25 percent for those who put down ten percent. Borrowers who qualify as reservists or Nation Guard members typically pay a slightly higher funding fee. 

Those who are have had previous VA home loans also pay a slightly higher funding fee, although it is waived entirely for applicants who are approved for disability compensation. 

Points to remember

In addition to the information above, those considering a VA home loan should also know that: 

  • a credit score of 620 or higher may be required, with some leniency for some past credit issues
  • income and debt ratios do apply, although these can be more flexible than a typical conventional mortgage
  • loan limits apply, and vary by the area in which the home is located
  • the home being purchased must pass a VA appraisal process 

To learn more about VA home loans and whether they are the right choice for you, buyers should discuss their financial situation and home purchasing goals with their real estate professional. 


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