2. How do VA Home Loans Compare to Conventional Mortgages?
VA loans offer several advantages over conventional loans. These include no down payment requirements, competitive interest rates, no monthly private mortgage insurance (PMI), and more flexible credit requirements. Many people often consider VA loans as one of the most cost-effective ways to finance a home purchase.
3. Can I Use A VA Home Loan More Than One Time?
If you are eligible for a VA loan, you have the option to use it more than once. However, there are sometimes restrictions on borrowing without making a down payment. These limits vary by location and can change from year to year. If you have enough entitlement left, you can use a VA loan to buy another home. Call HomePromise to see if you qualify at 800-720-0250.
4. Are VA Loans Limited to Specific Types of Homes?
You can use VA loans to purchase various types of properties. These properties include houses, condos, buildings with multiple units (up to four), manufactured homes on approved foundations and farms. However, the property must meet specific VA appraisal and safety standards.
5. How Long Does It Take To Get Approved For a VA Loan?
Approval time for VA loans varies, but it’s usually faster than you might think. Lenders, like HomePromise, can give you a pre-qualification letter in 24-48 hours, and the whole approval process usually takes 30-45 days. The key is to have your financial documents in order and work with an experienced VA lender.
6. Are There Closing Costs Associated With VA Loans?
Yes, there are closing costs associated with VA loans, but they tend to be lower than those of conventional loans, especially for eligible disabled veterans. Certain fees are not allowed to be paid by VA borrowers. The seller has the option to cover some or all the remaining costs.
7. Can I Refinance My Existing Mortgage with a VA Loan?
Yes, VA loans offer various refinancing options. The most common is the VA Interest Rate Reduction Refinance Loan (IRRRL), also known as a VA “streamline” refinance. This type of VA loan aims to lower the interest rate on an existing VA loan. Another option is the VA Cash-Out Refinance, which allows borrowers to tap into their home’s equity even if you don’t have a VA loan right now..
8. What is The Funding Fee, and Who Pays For It?
The funding fee is a one-time fee paid to the VA at closing. It helps offset the cost of the VA loan program for all veterans who participate. Lenders require most borrowers to pay this fee, but they grant certain exemptions, such as for veterans with service-related disabilities. Note that the VA funding fee can be different for each veteran depending on your down payment, previous VA loan use, and loan amount.
9. Can I Use a VA Loan for Investment Properties or Vacation Homes?
You cannot use a VA loan to purchase investment properties or vacation homes. The VA’s primary goal is to help veterans and active-duty service members achieve homeownership for their families. But, you can use your VA eligibility to buy a 2, 3 or 4 unit home as long as you occupy one of the units as your primary residence. This gives you the ability to rent out the extra units in the home the same way you would rent out an investment property.
10. Is a Good credit Score Necessary to Qualify for a VA Loan?
Having a good credit score can increase your chances of approval and get you a lower interest rate. VA loans have more flexible credit requirements compared to conventional loans.
Many VA lenders consider scores as low as 640, but HomePromise has closed VA loans as low as 580. Working with a lender, like HomePromise, who has experience in VA loans is essential to understand your specific credit situation.
Understanding VA loans is the first step towards leveraging this valuable benefit for veterans and military personnel. For any questions or help, contact the HomePromise VA loan experts at 800-720-0250.
