What if your service to the country could help you get your dream house?
Many veterans hold off on buying a home because they think the process is going to be complicated and annoying. Surprisingly, though, veterans have access to some of the very best mortgage loans and benefits.
Wondering how buying your first home can be easier than you ever imagined? Keep reading to discover our complete guide!
Choosing the Right Loan
One of the most confusing things about buying a home is the sheer amount of options available. You will encounter terms like “VA loan” and “FHA loan” that each have very different requirements. And there is a ton of variation when it comes to a “regular” home loan.
Generally speaking, you’re going to want to take advantage of the VA loan. That is because these loans offer a number of benefits that you cannot find with other options (see our notes below).
To get the most out of your benefits, you should have a conversation with your lender.
Talk With the Lender
It’s tempting to try to do all the research on your own. But there are a few questions that only a lender will be able to answer.
For example, lenders can tell you exactly what their qualification requirements are. This is important because lenders have the discretion to add additional qualifications or conditions on top of what the VA requires.
Lenders also have the discretion to offer certain perks and benefits to VA borrowers. This includes waiving certain fees and making the application process that much easier.
Benefits of VA Loans
As we noted, different lenders may have various additional benefits for veterans. But the core VA loan has a number of benefits that make it the best mortgage choice around.
The first benefit is that you can get a VA loan with no money down. With other types of home loans, you are typically required to put down at least 3.5%. With “zero down,” you can get the ball rolling without sticking back a ton of money.
The second major benefit is that you will have no additional mortgage insurance or mortgage premium. Those are typically added to home loans where the buyer puts down less than 20%. With a VA loan, you may have an upfront funding fee (or not), but you don’t have to worry about an ongoing premium on top of your mortgage payment and will effectively save money each month.
Finally, it can be a bit easier to qualify for a VA loan. VA does not stipulate a minimum credit score requirement, and lenders usually make it easier for those with less-than-perfect credit to qualify for these loans.
Different lenders may focus more on certain qualifying factors. However, your credit will be one of the primary factors. Even if your credit isn’t perfect, it’s worth talking to the lender about whether you can still get approved.
Regular income is another major factor. Obviously, the lender wants to make sure that you will have enough money each month to pay your mortgage.
Finally, you will need a Certificate of Eligibility. This verifies your military service and your qualification for a VA loan. You can apply for the COE through either the VA itself or through the lender.
Pre-Approval Is Recommended
Many first-time buyers think that they should find their dream home first and then get approval for a VA loan. And while nothing stops you from doing this, we generally recommend that you get pre-approved for a certain amount before you start hunting houses.
One reason for this is that it speeds everything up. When you find the home you want, you can get everything started without having to wait for approval with the lender.
Another reason is that pre-approval lets you know what your price range is. If you find a home first and then apply, there may be a scary waiting period where you hope you qualify for the amount you are seeking. With pre-approval, you know exactly how much you can spend on a home.
The Importance of a Real Estate Agent
Most veterans like to take care of things on their own. But when it comes to buying a home, it’s really important to find a good real estate agent.
And don’t settle for just any agent with good reviews. You’ll want to find someone who is very familiar with VA loans and the whole application and approval process.
The real function of such an agent is to help you save time and avoid stress. For example, they can help you avoid properties that may not pass the VA appraisal process. And an agent can answer your questions right away so you don’t have to spend sleepless nights on research.
Need a recommendation? Reach out to us. The Lindley Team has worked with a number of highly qualified agents and can assist you in finding a Realtor that fits you and your needs.
Stay On Top of Credit
If you haven’t already been doing so, it’s important to stay on top of your credit score. You can do this by signing up for a free credit monitoring service.
The short-term value of these services is discovering your credit score. This can help with everything from shopping for homes to negotiating with the lender.
In the long-term, though, these services can help you improve your credit. They show you what is bringing your score down and make recommendations on how to bring the score back up.
Remember, it’s vital not to disrupt your credit as you get closer to closing on the house! Meaning, don’t open OR close any credit accounts without consulting with your loan officer first.
If we had to name one “bad thing” about VA loans, it’s this: you are generally expected to start living within the home 60 days or less after closing.
This can be difficult, though, for active military members who may be unexpectedly called away to duty. For married service members, the easiest solution to this is to have a spouse or family member stay in the house while you are away.
If you’re worried about occupancy requirements, be sure to bring it up with the lender and ask for their recommendations.
Buying A Home: Your Next Move
Now you know the secrets to buying a home with a VA loan. But do you know where you can apply for such a loan right here and now?
We specialize in mortgage loans that help you make your home in Portland. To see how we can get everything started, come apply for a loan today!