Should You Choose a VA Loan?

Thinking about a home purchase? You’ve got a lot of decisions to make.

One of the biggest choices facing buyers centers on financing. Selecting a lender, type of loan, and loan terms can be tough.

A VA loan could put you in a new home

Is a VA loan right for you? Probably.

Let’s make it easy with a simple assertion: VA financing is often the best choice for those who qualify, particularly if you agree with one or more of the following statements.

1. “I Can’t/Don’t Want to Make a Down Payment.”

The era of loose lending is over (for now). Few options for 100 percent financing remain in the current market.

But VA loans continue to offer qualifying veterans the chance to purchase a home with zero money down. And in fact, 90 percent of Veterans United borrowers do just that.

“Regardless of where home prices are, 100 percent financing can be a great option for people,” said Veterans United CEO Nate Long in a New York Times article. “We’ve seen 9 in 10 of our borrowers use the full 100 percent.”

2. “My Credit is Less Than Perfect.”

In the aftermath of the mortgage meltdown, conventional lenders have enacted tougher credit guidelines. Those credit restrictions have kept countless civilians and service members from realizing their dreams of homeownership.

But less-than-perfect credit is a manageable (and common) situation for VA loan recipients. Most VA lenders only require a credit score of 620. That’s 142 points below the 762 average score boasted by conventional purchasers in September, 2012.

Past foreclosures and bankruptcies

VA loans are more forgiving when it comes to past foreclosures and bankruptcies.

3. “I Have a Recent Foreclosure or Bankruptcy.”

VA loans also offer more flexibility regarding a recent foreclosure or bankruptcy.

Most conventional lenders require borrowers to wait between two and four years post-bankruptcy before applying for a loan. FHA loans are more lenient, and usually enforce a two-year waiting period.

VA loans, on the other hand, can sometimes be granted to service members who are one or two years beyond a bankruptcy discharge. Every borrower is different, however, so be sure to talk to a VA loan specialist about your unique situation.

VA lenders are equally tolerant when it comes to foreclosure. While conventional and FHA lenders ask borrowers to wait three years post-foreclosure to apply for a loan, VA lenders will consider your application after two years.

But remember: Foreclosure and bankruptcy can be indications of poor fiscal habits. Lenders will want to see that borrowers have drastically improved those habits for a chance at any type of mortgage.

VA appraisal process ensures homes are Move-in ready

Move-in ready homes are ideal for VA financing.

4. “I Want to Buy a Move-In Ready Home.”

VA loans are the perfect financing tool for move-in ready homes. The VA appraisal, a mandatory process for VA borrowers, ensures that homes purchased by veterans are structurally sound and solid investments.

Homes in need of extensive repair won’t usually meet VA appraisal criteria. But for those ready to buy turnkey properties, VA financing can put dreams of homeownership within reach.

“VA Time is Always Fine”

There are certainly exceptions, but most buyers who qualify are best-served by VA financing. Benefits like low closing costs, 100 percent financing and flexible credit standards are enough to warrant a close look at the VA loan program for most buyers.

Wondering if you should choose a VA loan? Contact the VA loan specialists at Veterans United Home Loans. An experienced lender can examine your situation in detail and determine if a VA loan is the best option for you. You can reach a loan specialist by calling 855-524-7279, or get a return call by filling out this quick form. You can also check out this great guide comparing the VA loan to other mortgage products.

 

Photos courtesy of bfickAKZO Photo, and ilovebutter