VA Loan Requirements
Many people hesitate to look into VA loan options because the entire process can seem a little daunting. If you take it one step at a time, though, it doesn’t have to be that hard. The first step is simply to determine whether or not you are eligible, because there are some requirements that you must meet before you apply. There are a number of programs offered by the Veterans Administration, and you need to know whether or not you are eligible for them.
Eligibility means that you served during wartime (as defined by the VA) for at least 90 consecutive days or during peacetime for 181 consecutive days. You are also eligible for the program if you are currently on active duty after 90 days of active service.
Reservists are also eligible as long as you have served for at least six years, consecutively or non-consecutively, and even if you served in different branches of the reserves. The Army National Guard, Army Reserve, Air National Guard, Coast Guard Reserve, Navy Reserve, Marine Corps Reserve, and Air Force Reserve are all eligible for the VA Home Loan Program.
Other people who are considered eligible for these programs include:
- Spouses of deceased veterans who died as a result of their active service or service related injury (as long as they are not remarried)
- Spouses of missing-in-action personnel or prisoners of war that are members of the U.S. Armed forces and have been missing for more than 90 days
- U.S. citizens who served with an allied country during WW2 may be eligible
Eligible veterans also have an entitlement, with the current maximum set at $36,000. This can be raised to $60,000, though, if the loan exceeds $144,000. This is not the maximum loan amount, but the amount of your loan the VA guarantees to the bank. The entitlement never expires and can save you a lot of money by alleviating mortgage insurance expenses.
If you meet all of the eligibility requirements, the VA Home Loan Program can assist you in the home buying process and help you save a lot of money. If you are ready to learn more about your options, contact us today or fill out the form to receive a free quote.
VA Loan Occupancy Requirements
The occupancy requirement is another important part of a VA loan. This requirement can be different depending on your situation, so you need to understand the various provisions that you are entitled to. In simple terms, you must live in the home, or intend to live in the home within a reasonable time after you complete the loan process and acquire the property. A reasonable time is considered to be 60 days after the closing. If you cannot occupy the home after closing within the specified time, or future events will get in your way, the reasonable time limit can be extended. However, if you wait more than 12 months, you will have gone past what can be considered reasonable.
(There is one exception to personally occupying the home, and that is in the case of an Interest Rate Reduction Refinancing Loan. In this instance the borrowers will need to certify that he or she has previously occupied the home.)
There are also some intermittent occupancy provisions for people who travel for extended periods of time. This is only acceptable, though, if you have a history of continuous residence in the community and there is no indication that you have established, or are planning to establish, a primary residence somewhere else. A seasonal vacation home will not meet this requirement.
Sometimes a borrower’s spouse (and only the spouse) can satisfy the occupancy requirements. In other words, if you are on active duty, your spouse can count as having occupancy within the reasonable time requirements. This allowance will depend on the situation, but it can even apply to veterans that cannot move in within reasonable time because of non-military commitments somewhere else. Service members deployed from their permanent duty are considered to have temporary duty status will be considered to have already proven intent to occupy – in which case, it is not necessary for a spouse to occupy the home before the borrower has a chance to move in.
VA loans require no money down when you are purchasing a home, and are currently guaranteed for loan amounts up to $729,000. There is also no requirement for a great credit rating, because these loans can work with you even if you have a less-than perfect history.
Depending on your veteran status, the funding fee required by the Department of Veteran Affairs varies between 0-3.3 percent of the total amount of the loan. Veterans who were disabled 10% or more during active duty are not required to pay the funding fee.
Certificate of Eligibility
To qualify for a VA Loan you will need a Certificate of Eligibility. Once you have completed this simple form, our VA Loan Specialists can begin the process of helping you obtain your home loan.