A VA loan is a mortgage that is insured by the Veterans Administration. A borrower that has or is currently serving in the military can obtain a loan with 100% financing.
VA Loan Requirements
- VA loans require a COE (Certificate of Eligibility)
- Debt to Income ratio has based on the lender’s minimum requirement.
- The home must be the borrower’s primary residence.
- Credit score must fall within the lender’s acceptable range.
VA Funding Fee
The VA funding fee is a one-time payment that the Veteran, service member, or survivor pays on a VA home loan. This fee helps to lower the cost of the loan for U.S. taxpayers since the VA home loan program doesn’t require down payments or monthly mortgage insurance. The funding fee (approximately 2.3%) is a percentage of the loan amount, not the sales price. Your lender will share the exact rate with you. This fee is typically rolled into the loan. You will, in essence, be “financing” the funding fee.
What Are The VA Appraisal Requirements?
VA Appraisals are a bit more stringent than Conventional appraisals. They are very close to the same as an FHA appraisal. Not only is the appraiser reporting the market value of the home, they are also determining whether the home meets the agency’s minimum property requirements.
Some things that will not pass a VA appraisal are:
Peeling paint on the home
A roof that has less than three years of life left
Missing built-in appliances
Broken or cracked window panes
Missing or inoperable HVAC equipment
Make sure your Real Estate Agent knows that you are using a VA loan. This knowledge will keep them from showing you properties that will not qualify and help them to structure your offer correctly.
Let us know if you need help finding a lender that can help you obtain a VA loan. We are happy to make some introductions for you.