Veterans and service members who are not favored by conventional mortgages can use VA home loans to purchase a home. In 2003, VA expanded the bracket for those who qualified for this financing to accommodate eligible surviving spouses. With these loans, it is now possible to own, build, repair and retain a home at one of the best interest rates in the USA. Unlike other typical financing options, these loans offer a 100% funding, depending on the home value. In addition to the 100% financing, these loans incorporate other financial institutions to make VA blueprint a reality. The following piece explores the VA as a funding alternative.
What makes VA loans special?
Unlike in many parts of the world, veterans taking VA loans have a special tax exemption by different states. Although not all states have this policy, the policy makes this financing a game changer in the property market. Possessing these loans is an enough pass to subsidized property tax, and this is ideal for many people. However, it is critical to understand your state’s policy on special tax exemptions and tax cuts.
These loans are also one of the few financing options that have zero deposit criterion. Lack of down payments means that owning a home is now a simplified process to most service members and veterans. It is, however, important to understand the extent of this benefit when getting the loan. In special occasions, the lender may ask you for a certain amount of deposit depending on the sale agreement. The lender also has a right to ask for a down payment if the value of the property or the house is higher than the fixed value. These exceptions are however minimal.
Who qualifies for this special funding?
The qualifications bracket for this funding is arguably one of the vast funding brackets in the world of mortgages. The following are some of the groups that qualify for VA funding.
There are eight categories of people that qualify for this particular finding, and they include the following — Army, Navy, Coast Guard, Marine Corps, Air Force, National Guard, military spouses, and other special groups. According to a 2013 amendment, spouses of former service members are also eligible, but under special circumstances revolving around remarrying.
The other guidelines on service members include the following. First, you must establish that you have been in service for more than three months — 90 days during active wartime. Alternatively, if the above criterion eliminates you, you must prove to the relevant body that you have more than six years of active service in either a Reserves or a National Guard.
Application procedures for VA funding
After establishing that you met qualifications criteria, you must follow these simple alternative procedures. The first and the most efficient way is to apply for funding through an affiliate lender.
Alternatively, you can apply directly through VA. VA has simplified the process over the years, and most of the application process is online-based. The e-Benefits portal outlines what you need to provide to complete the application process.
The third alternative way to apply for this special funding is using VA Form 26-1880. Applying using this method is relatively slow because it is through the mail. However, all three ways are legal and serve the same purpose.