VA Loan Benefits & Tips
The Benefits of VA Loans for Veterans
Many vets who are buying a house for sale in Atlanta, GA aren’t aware of all the benefits a VA loan has to offer, though, so let’s dive right in.
A VA Loan is a loan that is specifically for veterans or personnel that are currently serving the military. VA Loans make it easier for military personal to either purchase or refinance a home. These loans are easier to qualify for and are also guaranteed by the United States Department of Veteran Affairs.
VA loans are more attractive for veterans because they are much more flexible than other conventional loans. One of the biggest benefits is that there is no down payment necessary or the need for any type of mortgage insurance.
Benefits of VA Loans
VA loans are also advantageous because there are lower closing costs, no down payment and they are much easier to qualify for than conventional loans.
Even though the funds don’t come directly from the VA, the VA will guarantee about 25% of the total loan from a bank. Therefore, the interest rate tends to be lower and there isn’t any private mortgage insurance required.
The VA does put a limit on the closing costs that the buyer is required to pay which makes it more affordable than other loans.
And with no pre-payment penalty, this means you can pay the entire mortgage off if you would like to without any fees from the bank.
The benefits are truly there and veterans should seriously consider a VA loan first.
Tips to Help Veterans Qualify for a VA Loan
Just as with any loan, there are a few things to keep in mind that can help veterans qualify for a VA Loan.
Certificate of Eligibility
In order to qualify for a VA loan, there is a combination needed of having enough income, a good credit score as well as securing a Certificate of Eligibility.
Qualifications for the certificate are usually offered to those serving in the armed forces, their spouses and past military veterans. Make sure to have your Certificate of Eligibility approved before applying for a loan.
Not unlike other conventional loans, veterans must know their credit history to apply for a loan. VA lenders usually look for a credit score around 620 which is actually a lot lower than most other loans. OF course, a higher credit ranking can also help you get a lower interest rate.
Only Use A VA Loan for Your Primary Residence
The VA wants veterans to use their loans only for buying or refinancing a primary residence. A single-family home, a condominium or even an apartment building (but you need to live in one of the units) can be used as the primary residence.
Stable Income is Necessary
Lenders for VA loans need to see reliable, stable income. There is a standard debt ratio to income to qualify for a VA loan which is essentially the amount of money you have each month after paying the bulk of your major expenses.
The typical debt-to-income requirement that most VA lenders require is around 41%.
Preapproval Is Essential
The best way to get a VA loan is to first get preapproved. It not only saves time, but you have a more realistic sense of which homes or properties you can afford.
If you are a veteran and are looking to purchase your first home or refinance another home, a VA loan can be very beneficial with many significant savings.
If you’re thinking of buying a home through a VA loan you can also check out these 7 VA loan tips to consider.
Here at Think GA Homes we work with many lenders that are favorable to low credit scores and veterans who may have experienced credit hardships in the past. Do not wonder if you would or would not qualify…find out for sure!
If you’re thinking about buying a home in Atlanta or the surrounding communities, we’d love to help you!