What exactly is a VA loan?
A VA loan is just a normal mortgage except it is guaranteed by the VA. In short, this means that you can get great financing terms because the lender can accept a lower down payment and offer a better interest rate because the government is protecting against the risk of non-payment by the borrower.
I have a down payment, why should I get a VA loan instead of a conventional mortgage?
VA mortgages are relatively easy to qualify for and generally they offer a better rate than conventional mortgages. Also, some veteran’s consider financing more of the home price and investing their cash instead of making a large down payment.
How much of my VA loan will be guaranteed?
In the lower 48 states, 25% of your loan will be insured. That amounts to a maximum of $104,250 (25% of $417,000). In Hawaii and Alaska, $156,375 can be insured which is 25% of $625,000.
How can I get a Certificate of Eligibility?
As long as you were discharged honorably, the process is very easy. Your lender will be able to help you with the process of obtaining a Certificate. If you were discharged dishonorably, the process is somewhat tougher but an experience loan officer can still help you.
Can I only get on VA loan in my life?
Your VA eligibility is good for an unlimited number of loans, assuming your credit is good and you made payment on the previous loan and you live in a different property.
Can I use a VA loan for real estate investing?
Unfortunately, VA loans are for owner occupied homes only.
How much can I afford?
The VA program accepts a debt ratio of up to 41%. This means that your monthly mortgage cannot make up more than 41% of your monthly income. Be sure to consider the ramifications of the length of your mortgage on your monthly payment.
That should answer a few of your basic VA home loan questions. Be sure to keep reading and we will continue to educate you on the ins and outs of your VA benefits.
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