What is a VA Loan?

11/14/2020

Veterans, we are eternally grateful for the sacrifices you have made for our country. While there is nothing we can do to adequately thank you for your service, we can offer guidance and assistance during your homebuying process. We are here to help you navigate VA loans and get the keys of your dream home into your hands.

What is a VA loan? - USA Mortgage

What is a VA Loan?


The Department of Veterans Affairs (referred to as the “VA”) created VA loans in 1944, as a way to help veterans purchase homes without the stress of saving for down payments or worrying about very high credit scores. The Department of Veterans Affairs backs the loans, which are awarded by local lenders. It is a federal program but is managed locally. USA Mortgage of Mid-Missouri is a proud participant in the VA loan program.

There are many factors that go into determining eligibility for VA loans. The Department of Veterans Affairs has a comprehensive guide that can provide you with the information you need. Typically, eligibility requires verifying your service meets the minimum thresholds as established by the VA and having qualifying credit. Credit score minimums for VA loans typically hover around the 620 mark.
Once you have gathered your documentation, you will apply for a Certificate of Eligibility (COE). You can do so online, by mail, or through your lender. This is the document the VA uses to confirm to the lenders that the veteran has met minimum service guidelines required for VA loans.


What are the Benefits of Using a VA Loan?


VA loans are an amazing benefit that you should consider taking advantage of. You do not have to be a first-time homebuyer to secure a VA loan, and you can receive VA loans for future home purchases as well. Some of the benefits include:

  • No down payment requirements
  • No mortgage insurance
  • Flexible closing costs
  • No fees for paying off the mortgage early
  • The option to refinance an existing mortgage

I’m Eligible, and Plan to Use a VA Loan. Now What?


Once you have received your COE and have decided on a VA loan, the fun part begins! You can shop for your dream home. VA loans don’t have extremely strict stipulations for what you can purchase. You can choose a condo, new or old home, or even a multi-unit property. However, you can’t use a VA loan to purchase rental properties or homes that are not your primary residence.

VA loans do not come with a specific maximum dollar amount that you can borrow. Instead, the loan is based on the property value, local loan limits, and the lender’s requirements.


VA Loan Requirements


To be eligible for a VA loan, you must meet certain service criteria, such as length and character of service. Eligibility is extended to:

  • Veterans who meet service length requirements.
  • Service members on active duty who have served a minimum period.
  • Certain reservists and National Guard members.
  • Surviving spouses of deceased veterans, under certain conditions.

Property Types and VA Loan Limits


VA loans offer flexibility in property choice, allowing veterans to purchase condos, single-family homes, or multi-unit properties, as long as they serve as the primary residence. While VA loans do not have a maximum loan limit, they are typically influenced by the property value, local loan limits, and the lender’s criteria.


Are There Other VA Benefits in Mid-Missouri?


Mid-Missouri is a great place for veterans to live. Columbia is home to the Harry S. Truman Memorial Veterans’ Hospital, one of only four veterans’ hospitals in the state. There is also a Columbia Vet Center. As a college town, there are many great education options available as well. Mizzou and Columbia College both have Veterans’ centers. The Columbia area has a lot to offer, and we are sure you will enjoy living here.

We hope to help you secure a VA loan of your own. Reach out to a local USA Mortgage loan officer today to get the process started!


FAQs for What is a VA Loan?


What is a VA loan and who is it for?

A VA loan is a mortgage loan designed to help veterans, active-duty service members, certain reservists, National Guard members, and eligible surviving spouses purchase a home. It is backed by the U.S. Department of Veterans Affairs (VA) and offers various benefits such as no down payment and no mortgage insurance.

What types of properties can be purchased with a VA loan?

VA loans can be used to purchase a variety of properties, including condos, single-family homes, and multi-unit properties, as long as they are used as the primary residence. However, VA loans cannot be used to purchase rental properties or vacation homes.

What are the eligibility requirements for a VA loan?

To be eligible for a VA loan, you must meet certain service criteria, such as length and character of service. This includes veterans who meet specific service length requirements, active-duty service members, certain reservists and National Guard members, and surviving spouses of deceased veterans under certain conditions. Eligibility is confirmed through a Certificate of Eligibility (COE) issued by the VA.

Can I use a VA loan more than once?

Yes, you can use a VA loan multiple times throughout your life, as long as you meet the eligibility requirements each time. Your VA loan entitlement can be restored after paying off the previous VA loan or selling the property. This allows you to continue to benefit from the VA loan program for future home purchases.

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USA Mortgage Abadi Region

A full-service mortgage lender with local branches in Missouri, Arkansas, Illinois, and nearby areas.