VA loan is a type of a mortgage loan that is backed by the VA (Department of Veteran Affairs) and meant for people, who served or are currently serving in U.S. military forces. Although the VA is not lending any money for VA loans, it is still backing up loans that are made by private lenders – mortgage companies, savings and loans, banks. VA loans are aimed at military personnel, veterans and military spouses.
There are three types of VA loans available – purchase loans, interest rate reduction refinance loans, also known as the IRRRL, VA streamline refinance loan and cash-out refinance loans. There are plenty of advantages to VA loans, yet one of the most notable ones is the fact that no down payment is required in order to buy a home. This is the best way for military personnel and veterans to purchase real estate property indeed.
People eligible for VA loans
VA loans are meant for the military personnel, military families as well as veterans. Following categories of people are eligible for VA loans:
- Active-duty personnel
- Members of reserve
- Members of National Guard
- Surviving spouses
It is also important to have a good credit, adequate income as well as valid COE (Certificate of Eligibility). One will also have to use purchased house for personal occupancy. Not certain whether you are eligible? Go to the website of the Department of Veterans Affairs in order to learn more about the eligibility requirements for the military spouses, veterans and military personnel.
The VA loan program is delivering the most beneficial as well as genuinely flexible loans on the market, which are aimed exclusively at veterans, military personnel and their family members. Biggest advantages of VA loans are the affordability comparing to other options and absence of necessity for a down payment and private mortgage insurance requirement.
How big a VA loan can be?
The VA states that there is no limit to what an eligible veteran could borrow using VA loans. However, there are certain county limitations that could be used in order to calculate the maximum guaranty amount for any certain county. Generally speaking, there are no limitations to how much you can spend for a new house using the VA loan, but the VA loan has limits of how much liability to assume, which can affect the amount of money a lender will provide you with.
In most cases, military personnel as well as the veterans can count on getting up to $417 000 without any down payment.
Finding the right VA lender
There is a number of ways of finding a VA lender for military personnel or veterans, including recommendations from friends and loved ones as well as visiting the VA webpage. Much like the usual loans, you can also try and talk to different lenders to find the best one. LBC Mortgage Solutions could be a great help in finding the best VA loan.