What’s so Special About the VA Home Loan Program?
The VA home loan program was formed in 1944 to provide affordable housing to World War II veterans that recently returned from battle. Since then, the VA home loan program has morphed into one of the most advantageous programs available and has helped more than 20 million service members finance the home of their dreams.
The program has made it over 65 years through its self-sustaining nature, as well as having some of the lowest foreclosure rates of any other mortgage program.
Purchasing a home can be exciting as well as rather stressful at times. This is especially felt by veterans who have spent their lives moving from base to base and being deployed, which can take a toll on finances and make conventional lending programs nearly impossible to obtain. For this main reason the VA home loan program was formed.
The VA loan program caters specifically to the needs of our service members, providing a stress-free process with benefits that no other program can match. Popular benefits include:
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No money down option for qualified buyers, with down payments rarely exceeding 5 percent for those required to place a down payment
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No prepayment penalties
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Interest rate caps for active duty service members under the Servicemembers’ Civil Relief Act
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Lenient credit requirements
How Much Can I Borrow?
In the Palm Springs area, the maximum VA loan amount is $417,000, which easily compliments Palm Springs affordable living conditions. In some areas, you may indeed spend only half that amount. Prospective borrowers are able to refinance a current single-family home, purchase a new home, or VA-approved condo as well. The only limitation is that the home you purchase must be your primary residence, which means no investment properties or land purchases.
There are many more options when using your VA home loan benefit, so it is important to speak with a knowledgeable realtor, such as The Brokerage Real Estate Group or a VA approved lender, such as Veterans United, before you move too far forward.
Eligibility
To be eligible a service member must have served on active duty for three months during wartime or 181 days during peacetime. A service member is also eligible after serving in the National Guard for at least six years; however, service members with a dishonorable discharge do not qualify for the program. If a service member falls under one of these categories, they must next acquire their VA Certificate of Eligibility, which can be procured through a VA-approved lender or the VA itself.
The VA does not set income or eligibility requirements for this program; however, most lenders expect a credit score of at least 620 to secure financing. Remember, all are encouraged to apply since loans have been secured with less.
Guest author Kevin Pearia is a mortgage commentator for VeteransUnited.com, the nation’s leading dedicated provider of VA home loans.
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