As a veteran or an active serviceman, you can get the home you deserve, thanks to VA home loan. Buying the house on the beach, or near the sheriff’s home using your VA loan benefits can be one of the greatest experiences you have ever had. However, be aware of the frustrations and uncertainty that comes with the whole process. There are some key issues you need to be mindful of. Here are eight VA home loan tips that can help you get the house of your dreams.
1. You Don’t Need to Start with COE
It’s not mandatory to have your VA certificate of Eligibility to get the process of acquiring the loan. Later on, your lender will ask for the document. However, you can obtain yours later.
Don’t let your COE’s absence stop you from reaching out to a VA approved lender to kick-start the process of pre-qualification and pre-approval.
2. Be Aware of Your Credit Report
When applying for a home loan, it’s good to know your credit history. You don’t need a perfect credit. In fact, most VA lenders set the score at 620, which is lower compared to the score for conventional or FHA financing. A higher credit score will, however, help you get lower interest rates.
Get your credit report for free from either of the three credit bureaus before applying for a house loan.
3. Find Agents that Better Understand VA
Real estate agents know the rights and wrongs of home buying, and they can guide you in the process, but not all of them understand VA loans.
Agents who understand VA can help borrowers avoid homes that may have issues with the VA’s appraisal process. They can also state whether it’s worth building your home. Some borrowers have opted to build their own homes with the financing of VA construction home loans.
4. It’s Not a One-Time Benefit
The moment you get a VA home loan benefit, it will be yours forever. It isn’t a one-time lending option that is built for first-time homebuyers. No!
You can actually use these benefits as many times as you want. You can have more than one VA loan at a single time. You can even get one after defaulting on the previous one.
5. You Must have a Reliable Income
A lender wants to be assured that the borrower will pay the loan, and so they make sure you have a reliable recurring income. An acceptable DTI, which is debt to income ratio is a must. The VA wants the ratio to be below or at 41 percent.
If you go higher doesn’t mean you won’t qualify for a mortgage though. Talk to your lenders to know what they need, but remember that continuing salary is vital.
6. There are Limited Condo Choices
To purchase condos, veterans need VA-approved developments. The headache is on finding an approved one. Lenders can help find it, but the process might take a long time.
The best thing to do is to adjust your timeline for buying a home.
7. Stick with Your Budget
The pre-approved amount represents what you can comfortably afford on your present financial situation. The excitement that comes with home search can lead you to choosing a house beyond your means.
If you get a pre-approved amount of $500,000, don’t purchase a house that’s worth $500, 000. A new home might come with new expenses like maintenance costs, property taxes, and homeowners insurance.
8. You Must Get a Loan Pre-approval
Getting pre-approved for a house loan is important because it grants you a clear sense that no time will be wasted touring homes you can’t afford.
Pre-approval also demonstrates to the sellers and real estates that you are serious about buying the home.
From the tips above you have understood more about VA home loans. The bottom line is, as long as you are eligible, at the end of the process you will have your dream home.