VA Home Loans
Home for the brave and the free.
Our VA Home Loans
VA loans are government-backed loans intended to help eligible service members, veterans, and military spouses to purchase homes. These loans come with great rates and payment terms, and require no down payment. Learn more about our VA home loans and how your sacrifice is rewarded is some small measure.
About VA Home Loans
Is A VA Loan Right for You?
Are you an active military member, veteran, reservist, or surviving spouse? You may be eligible for a VA loan.
If you are a veteran, thank you for your service! The entire Old Town Lending team appreciates the sacrifices you have made in defending our country. If you are reading this, then you are most likely considering buying a home and would like to know more about VA loans. VA home loans are a terrific benefit that can help you get into your dream home.
A VA loan is a low or zero-down payment mortgage option offered to eligible veterans and active duty service members and their families. VA loans are partially backed by the Department of Veterans Affairs (VA) and are issued by private lenders. Old Town Lending is an approved VA lender, and has closed millions in VA Loan transactions.
Benefits
VA loans are available to eligible veterans, active duty service members, and in some cases, their spouses.
- In many cases, there’s no required down payment. That’s right! A good portion VA loans are able to offer 100% financing to qualifying veterans.
- No PMI. One of the most significant benefits of a VA home loan is that there is no private mortgage insurance (PMI), regardless if you do not place any money down.
- No restrictions to where you buy or for how much. The Department of Veterans Affairs does not have a limit to how much you can borrow but, keep in mind, you do still have to qualify with proof of income and employment.
Some other VA loan benefits may include:
- Better terms and interest rates.
- No penalty fees for paying your loan off early.
- Fewer closing costs.
Loan Eligiblity
With lower rates and flexible programs, your finances may stretch further.
- Eligibility: VA loan eligibility standards differ depending on your status in the military. There are four primary categories that the Department of Veterans Affairs will assess your eligibility from. These categories are active duty, veteran, Military Reserves or National Guard, and military spouse. You can reference the VA loan program eligibility requirements here.
- Credit score: The VA does not specify a minimum credit score; however, the actual lender might. The VA only guarantees a portion of the loan to the lender.
- Down payment: The VA no longer has limits on their loans; however, the lender will determine how much you can borrow.
- A low debt-to-income ratio: Your total monthly debt is less than 41% of your total gross monthly income. But borrowers with higher DTI ratios can get approved if they have enough "residual income," another factor lenders consider when reviewing mortgage applications.
VA Loan FAQs
The home you are purchasing with you VA Loan must be your primary residence. This means that you and your family must intend to live in the home after purchasing it. VA loans will not cover investment properties or a vacation home.
PROPERTY CONDITIONS
To ensure the best chances for your property to be approved by the VA’s Minimum Property Requirements (MPRs), make sure your home covers the following:
- Mechanical systems are operating safely and are deemed to have reasonable future utility.
- Adequate heating supply that is in good working order.
- Roofing must be in good condition with no major leaks.
- Property must be free of any structural threats such as termites, rot, or fungus.
- Generally speaking, it is best to avoid homes listed “as is” as these homes tend to have one or more of the above listed issues.
CONDOMINIUM PURCHASES
The Department of Veterans Affairs has a database of approved developments. Ask your lender if the condo you are wanting to purchase is on this list. If your dream condo is not on the VA’s list, your lender can ask the VA to approve this development. Keep in mind that the VA’s process for adding a new condo development to their approved list can take months and is not guaranteed to be approved once the process is over.
As long as you have enough entitlement, you can have two VA loans at one time. This often comes into play when active duty personnel are transferred and want to purchase a home without selling their existing property.
Before we jump into VA loan eligibility and the application process, we would like to mention an often overlooked topic related to VA loans. The VA funding fee is a one-time payment that you will make on a VA home loan. This fee is required by the U.S. government and helps reduce the cost of the loan for U.S. taxpayers. The VA funding fee can be paid for in a variety of ways and by no means has to be paid upfront. When you close on your VA loan, you can choose to pay the VA funding fee by rolling it into the total amount of your loan or pay the full amount at closing. The VA funding fees page has a rate chart that goes into greater detail as to how much you can expect to pay.
Who is exempt from the VA funding fee?
There are a few exemptions to the VA funding fee. The most common is a service disabled veteran who is receiving VA compensation. You may be eligible for a refund of the VA funding fee if you are later awarded disability status from the U.S. Department of Veterans Affairs.
An unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible.
The fastest way to obtain the COE would be to have a VA-approved lender to request this for you. You can also apply for your COE online through the VA’s eBenefits portal or by filling out this request form and mailing it to your regional loan center.
No, children of an eligible veteran are not eligible for this benefit.