VA Loan Basics

A VA loan is a mortgage loan guaranteed by the U.S. Department of Veterans Affairs (VA) and issued by private lenders, such as banks and mortgage companies. VA loans are designed to help military service members, veterans, and their families buy or refinance homes.

Here are some basics about VA loans:

• Eligibility: VA loans are available to active-duty military members, veterans, National Guard and Reserve members, and surviving spouses of veterans. To be eligible, the borrower must have served at least 90 consecutive days on active duty during wartime or 181 consecutive days during peacetime.

• Benefits: VA loans offer several benefits, including no down payment requirement (in most cases), no private mortgage insurance (PMI) requirement, and competitive interest rates. The VA also limits closing costs that lenders can charge and provides assistance to borrowers who have trouble making their mortgage payments.

• Application process: To apply for a VA loan, the borrower must obtain a Certificate of Eligibility (COE) from the VA (or a VA approved lender such as myself). The COE verifies the borrower's eligibility for a VA loan and if a funding fee applies or not. The borrower then applies for the loan with a VA-approved lender, who will evaluate their credit and income to determine their ability to repay the loan.

• Loan types: VA loans can be used to purchase or refinance a primary residence, including single-family homes, townhouses, and condominiums. As well as 2-4 units while using the rents from the other units to help qualify/pay for the mortgage.

Overall, VA loans are a valuable benefit for those who have served or are serving in the military. If you're eligible for a VA loan and are considering buying or refinancing a home, it's worth exploring this option