In a series of bills enacted and revised since 1944, the U.S. Department of Veterans Affairs (VA) has guaranteed home loans made to service members, veterans, Reserve/National Guard members, and eligible surviving spouses. Through this program, the VA can “help you buy, build, repair, retain, or adapt a home for your own personal occupancy.” Since 1944, more than 20 million such loans have been issued.
VA loans are actually made through private lenders, such as mortgage companies and banks, not through the government, but the VA’s guarantee allows the loans to be issued without down payments and without mortgage insurance. That can mean a substantial reduction in cost.
You will still need to apply for a loan, meet certain credit and income qualifications, purchase your property, and make your payments. But the process is quite simple:
There are two steps:
1. Make sure your service qualifies you as eligible. The VA/Home Loans Eligibility page details the various categories of eligibility.
2. If you qualify, apply for a Certificate of Eligibility (COE). Depending on your current service status, you will need to provide different types of evidence of your qualification. Those are detailed on the Certificate of Eligibility page, which also gives instructions for applying for a COE through eBenefits.
Determine loan type
This is where your mortgage banker can really help, explaining the types of loans that are available and helping you determine how much you can afford to spend on your home. Your loan officer will request a variety of information from you to prepare a pre-approval letter and will also explain the paperwork, fees, payment schedule, and the progression of steps before the loan is funded. Make sure you read and understand the documents and don’t hesitate to ask questions!
With your pre-approval and/or pre-qualification letter in hand, you can select a Realtor and start shopping for the home of your dreams.
Thank you for your service.