Are you a veteran or active-duty military member looking to buy a house? If so, you may be eligible for a VA loan. VA loans offer many benefits, including lower interest rates, no down payment requirement, and no private mortgage insurance. However, to qualify for a VA loan, you must meet certain requirements. In this article, we’ll discuss everything you need to know about military VA loan requirements.
The Benefits of VA Loans
Before we dive into the requirements for VA loans, let’s take a look at the benefits they offer.
First and foremost, VA loans don’t require a down payment. This can be a significant advantage for veterans and active-duty service members who may not have a lot of cash on hand. Additionally, VA loans don’t require borrowers to pay for private mortgage insurance (PMI), which can save borrowers hundreds of dollars per month.
Another benefit of VA loans is that they typically offer lower interest rates than conventional loans. This can save borrowers thousands of dollars over the life of the loan.
Military VA Loan Requirements
Eligibility Requirements
To qualify for a VA loan, you must meet certain eligibility requirements. These requirements vary depending on your military status and length of service. Here are the basic eligibility requirements:
Military Status |
Length of Service |
VA Loan Eligibility |
|---|---|---|
Active-duty |
90 days |
Eligible |
National Guard or Reserves |
6 years |
Eligible |
Veteran |
N/A |
Eligible |
Surviving spouse |
N/A |
Eligible in certain circumstances |
Credit Requirements
While VA loans don’t have a minimum credit score requirement, most lenders will look for a credit score of at least 620. Additionally, borrowers will need to show that they have a stable income and a debt-to-income ratio of 41% or lower.
Property Requirements
VA loans can only be used to purchase primary residences. Additionally, the property being purchased must meet certain requirements, including:
- The property must be in good condition and meet certain safety standards
- The property must be move-in ready
- The property must be located in a VA-approved area
Funding Fee
One thing to keep in mind when applying for a VA loan is the funding fee. This fee is a one-time payment that is required by the VA to help offset the cost of the loan program. The amount of the funding fee varies depending on the type of loan and the borrower’s military status. However, the fee can be rolled into the loan, so borrowers don’t have to pay it upfront.
Applying for a VA Loan
If you meet the eligibility requirements and are interested in applying for a VA loan, the first step is to obtain a Certificate of Eligibility (COE) from the VA. You can do this online, through your lender, or by mail. Once you have your COE, you can begin the loan application process.
FAQs
1. Can I use a VA loan to buy a vacation home?
No, VA loans can only be used to purchase primary residences.
2. Can I use a VA loan to buy a multi-family property?
Yes, VA loans can be used to purchase multi-family properties, as long as the borrower will be living in one of the units.
3. Is there a maximum loan amount for VA loans?
Yes, the maximum loan amount for VA loans varies depending on the county where the property is located. In most areas, the maximum loan amount is $548,250 in 2021.
4. Do I have to pay for a home appraisal with a VA loan?
Yes, borrowers are responsible for paying for a home appraisal as part of the VA loan process.
5. How long does it take to get a VA loan?
The timeline for getting a VA loan can vary depending on the lender and other factors. However, the process typically takes between 30 and 45 days.
6. Can I use a VA loan to refinance my current mortgage?
Yes, VA loans can be used to refinance existing mortgages, including VA loans.
7. Can I get a VA loan with bad credit?
While VA loans don’t have a minimum credit score requirement, most lenders will look for a credit score of at least 620. Additionally, borrowers will need to show that they have a stable income and a debt-to-income ratio of 41% or lower.
8. How often can I use a VA loan?
There is no limit to the number of times you can use a VA loan, as long as you meet the eligibility requirements.
9. Can I use a VA loan for a fixer-upper?
Yes, VA loans can be used to purchase fixer-uppers, but the property must be move-in ready at the time of purchase.
10. Can I use a VA loan to buy a condo?
Yes, VA loans can be used to purchase condos, as long as the condo is in a VA-approved complex.
11. Can I use a VA loan for new construction?
Yes, VA loans can be used for new construction, but the builder must have a VA builder ID number.
12. What is the VA loan funding fee?
The funding fee is a one-time payment that is required by the VA to help offset the cost of the loan program. The amount of the fee varies depending on the type of loan and the borrower’s military status.
13. Can I get a VA loan if I’ve had a foreclosure or bankruptcy?
It depends on the circumstances surrounding the foreclosure or bankruptcy. In general, borrowers will need to wait two years after a foreclosure or bankruptcy before they can apply for a VA loan.
Conclusion
VA loans offer many benefits for veterans and active-duty service members. However, to qualify for a VA loan, you must meet certain eligibility requirements, including credit and property requirements. If you’re interested in applying for a VA loan, be sure to obtain a Certificate of Eligibility (COE) from the VA, and work with a lender who has experience with VA loans.
At the end of the day, VA loans can be a great way for veterans and active-duty service members to achieve the dream of homeownership. If you think you might be eligible for a VA loan, don’t hesitate to explore your options and see if it’s the right choice for you.
Closing/Disclaimer
This article is for informational purposes only and does not constitute legal or financial advice. It’s important to consult with a qualified professional before making any financial decisions, including applying for a VA loan.