VA Loans

Veteran Home Loans for your VA Home Loan needs.

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eligible veterans and regular active duty personnel by private

lenders such as mortgage companies, banks, or savings and

loans for the purchase of homes used for their own personal

occupancy. If the lender approves the loan, the VA will

guarantee a portion of the loan amount to the lender. This VA

guarantee protects the lender against loss up to the amount

guaranteed by the VA, allowing a veteran to obtain favorable financing terms.

qualified veterans

No down payment (unless required

by lender or purchase price is more than property’s reasonable

value)

Buyer is informed of reasonable

value

Negotiable interest rate

Ability to finance the VA funding

fee

Closing costs that are comparable

with other financing programs (and maybe lower)

No mortgage insurance premiums

An assumable mortgage

Right to prepay without penalty

For homes inspected by VA during

construction, a warranty from builder and assistance from VA

to obtain cooperation of builder

VA assistance to veteran borrowers

in default due to temporary financial difficulty

VA DOES NOT DO THE FOLLOWING:

VA cannot guarantee that a lender

will provide you a loan.  VA

cannot compel a lender to make a loan

that would violate their lender

policies or VA income and credit

standards.

VA cannot guarantee that a home

is free of defects. It is the

veteran’s responsibility to assure

that he/she is satisfied with the

property being purchased. The VA

appraisal is not intended to be an

“inspection” of the property. A

veteran should seek expert advice (a

qualified residential inspection

service), as necessary, BEFORE legally

committing to a purchase agreement.

If you have a home built, VA cannot

compel the builder to correct

construction defects, although VA does

have the authority to suspend a

builder from further participation in

the home loan program.

VA cannot guarantee that a veteran

is making a good investment.

VA cannot provide a veteran with

legal services.

HOW DO I OBTAIN A VA LOAN

(GENERAL GUIDELINES)?

1. Contract to purchase: Select a

home, discuss the purchase with the seller or selling agent, and possibly

sign the purchase contract conditioned on approval of a VA guaranteed loan.

2. Loan application: Select your lender if you haven’t done so already.

Provide  your Certificate of Eligibility to the lender and complete the

loan application. The lender will develop all credit information and request

that the VA assign a licensed appraiser to determine the reasonable value

for the property. You will pay for the credit report and appraisal unless

the seller agrees to pay. Either the VA or the lender will issue a value for

the property for loan purposes based on the appraisal.

3. Loan decision: If the established value is acceptable to all parties and

the lender determines that your are credit and income qualified, the loan

may be approved. Most lenders are authorized to make this decision.

4. Loan closing: You (and spouse, if applicable) attend the loan closing and

sign the note, mortgage, and other related papers. The lender or closing

attorney will explain the loan terms and requirements as well as where and

how to make the monthly payments. When the loan is reported to the VA, the

VA annotates your Certificate of Eligibility to reflect the use of

entitlement and returns it to the applicant. (The loan closing procedure may

vary in some states.)

GENERAL RULES OF

ELIGIBILITY

Military Service

Requirements for VA Loan Eligibility:

*NOTE: Applications

involving other than honorable discharges will usually require

further development by VA. This is necessary to determine if the service was

under other than dishonorable conditions.

You must have at least 90

days on active duty and been discharged under other than dishonorable

conditions. If you served less than 90 days, you may be eligible if

discharged for a service connected disability.

You must have served at least

181 days of continuous active duty and been discharged under other than

dishonorable conditions. If you served less than 181 days, you may be

eligible if discharged for a service connected disability.

Service after 09/07/80

(enlisted) or 10/16/81 (officer)

If you were separated from

service which began after these dates, you must have:

(a) Completed 24 months

of continuous active duty or the full period (at least 181 days) for which

you were ordered or called to active duty and been discharged under

conditions other than dishonorable, or

(b) Completed at least 181 days of active duty and been discharged under the

specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early out), or

have been determined to have a compensable service-connected disability;

(c) Been discharged with less than 181 days of service for a

service-connected disability. Individuals may also be eligible if they were

released from active duty due to an involuntary reduction in force, certain

medical conditions, or, in some instances for the convenience of the

Government.

Gulf War – Service

during period 08/02/90 to date yet to be determined

If you served on active duty

during the Gulf War, you must have:

(a) completed 24 months

of continuous active duty or the full period (at least 90 days) for

which you were called or ordered to active duty, and been discharged under

conditions other than dishonorable; or

(b) completed at least 90 days of active duty and been discharged under the

specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early out), or

have been determined to have a compensable service-connected disability, or

(c) been discharged with less than 90 days of service for a

service-connected disability. Individuals may also be eligible if they were

released from active duty due to an involuntary reduction in force, certain

medical conditions, or, in some instances, for the convenience of the

Government.

Active Duty Service

Personnel

If you are now on regular

active duty (not active duty for training), you are eligible after having

served 181 days (90 days during the Gulf War) unless

discharged or separated from a previous qualifying period of active duty

service.

Selected Reserves or

National Guard

If you are not otherwise

eligible and you have completed a total of 6 years in the Selected

Reserves or National Guard (member of an active unit, attended required

weekend drills and 2-week active duty for training) and

(a) were discharged with an

honorable discharge; or

(b) were placed on the retired list; or

(c) were transferred to the Standby Reserve or an element of the Ready

Reserve other than the Selected Reserve after service characterized as

honorable service; or

(d) continue to serve in the Selected Reserves.

Individuals who completed less than 6 years may be eligible if discharged

for a service- connected disability.

You may also be

determined eligible if you:

(a) are an unremarried spouse

of a veteran who died while in service or from a service connected

disability, or

(b) are a spouse of a serviceperson missing in action or a prisoner or war.

[NOTE:

Also, a surviving spouse who remarries on or after attaining age 57, and on

or after December 16, 2003, may be eligible for the home loan benefit.

However, a

surviving spouse who remarried before December 16, 2003, and on or after

attaining age 57, must apply no later than December 15, 2004, to establish

home loan eligibility. VA must deny applications from surviving spouses who

remarried before December 16, 2003 that are received after December 15,

2004.]

Eligibility may also be established for:

(a) certain United States

citizens who served in the armed forces of a government allied with the

United States in WWII.

(b) individuals with service

as members in certain organizations, such as Public Health Service officers,

cadets at the United States Military, Air Force, or Coast Guard Academy,

midshipmen at the United States Naval Academy, officers of National Oceanic

& Atmospheric Administration, merchant seaman with WW II service, and

others.

HOW CAN I OBTAIN MORE INFORMATION ABOUT VA HOME LOANS?

Call the VA at 1-800-827-1000 or visit their Web site at

http://www.homeloans.va.gov.

Information on this page

is deemed reliable but not guaranteed.