This article is about everything you need to know about VA loans.
In this article, we will cover and discuss everything you need to know about VA loans. We will discuss the frequently common questions our team at Gustan Cho Associates get daily on VA loans. Gustan Cho Associates gets thousands of daily unique visitors reading our updated mortgage articles. Many of our viewers are often confused about getting misinformation from other websites and/or mortgage companies. One thing you need to rest assured of is that Gustan Cho Associates does not report any misinformation. We only report the facts and whatever articles we publish are fact-checked and correct. All of the agency mortgage guidelines on VA loans published on Gustan Cho Associates are correct and updated. Gustan Cho Associates is a mortgage company licensed in multiple states with no lender overlays on government and conventional loans. Gustan Cho Associates are mortgage bankers, correspondent lenders, and have the ability to offer non-QM and alternative mortgage loan programs. We have dozens of lending partnerships with wholesale non-QM and alternative mortgage lenders. This is why we have a national reputation of being a one-stop mortgage lending shop. From FHA, VA, USDA, Conventional, Jumbo, non-QM, and alternative mortgage loans, if it is in the market, Gustan Cho Associates has it. VA loans are hands down the best loan program in the nation. Not every homebuyer can qualify for a VA loan.
Everything You Need To Know About VA Loans: VA Mortgages Explained
VA loans are one of the three government loan programs in the United States. Not everyone can qualify for a VA loan. You need to be a retired and/or active member of the United States Armed Services with a Certificate of Eligibility (COE) from the United States Department of Veterans Affairs (VA). The United States Congress created and launched VA loans to reward the brave men and women of the United States Military for their service. Not everyone who served in the U.S. Military is eligible for VA loans. To be eligible for VA loans, you need a valid Certificate of Eligibility from the VA.
Everything You Need To Know About VA Loans: History On Why VA Loans Was Created And Launched
VA mortgages were created and launched to offer long-term financing to active and/or retired members of the U.S. Armed Services or their surviving spouses. The goal of Congress was to make homeownership affordable to active and/or retired members of the U.S. Military or surviving spouses by making VA loans available with no down payment, no maximum debt to income ratio, no minimum credit score requirements, lenient credit and income agency guidelines, and no maximum loan limit at very competitive mortgage rates. The U.S. Department of Veterans Affairs is the government agency in charge of administering VA loans which include setting up agency guidelines and requirements. In this blog, we will discuss and cover Everything You Need To Know About VA Loans.
Why VA Loans Are The Best Home Mortgage Program In The Nation
It is no secret that VA loans do not require a down payment. Due to the government guarantee by the Veterans Administration, lenders are more than eager to approve qualified borrowers for VA loans with zero down payment and offer them 100% financing. What the government guarantee by VA means is in the event the borrower defaults and/or forecloses on their VA loan, the VA will partially cover the loss sustained by the lender due to the default on the VA loan. Besides the no down payment on a home purchase, VA loans do not have mortgage insurance requirements. HUD requires a mandatory annual mortgage insurance premium on all FHA loans no matter what the loan to value is for the life of the FHA loan. Fannie Mae and Freddie Mac require private mortgage insurance on all conventional loans with loans to value higher than 80% LTV.
VA Funding Fee And Property Tax Exemption On VA Loans Explained
There is a one-time VA Funding Fee charged on veteran homebuyers and/or homeowners on purchase and/or refinance mortgage transactions. However, the VA funding fee is exempt for disabled veterans. Most municipalities will exempt property taxes on disabled veterans. You need to be fully disabled in order to qualify for a full property tax exemption. The property tax exemption is not from the VA but rather from the local county government agency.
VA Loans Have Lenient Agency Mortgage Guidelines
It is easier to qualify for VA loans than any other government and/or conventional loans. There are no minimum credit score requirements on VA loans. There is no maximum debt to income ratio requirement. Outstanding collections and charged-off accounts do not have to be paid to qualify for VA loans. There is a two-year waiting period after Chapter 7 Bankruptcy, foreclosure, deed in lieu of foreclosure, short sale. Borrowers in an active Chapter 13 Bankruptcy repayment plan can qualify for a VA loan one year into the repayment plan with bankruptcy trustee approval. Chapter 13 Bankruptcy does not have to be discharged. Timely payments during the repayment plan are required. It needs to be a manual underwrite. There is no waiting period after the Chapter 13 Bankruptcy discharged date to qualify for VA loans. Timely payments and rebuilt//re-established credit after bankruptcy are required to get an approve/eligible per automated underwriting system.
Eligibility Requirements On VA Loans
As mentioned earlier, not everyone can qualify for VA loans. The following are the eligibility requirements for those who are eligible to qualify for VA loans:
- Eligible members of the military with a COE on active duty
- Eligible retired veterans with a COE
- National Guard Members with COE
- Reservists with COE
- Cadets in the Air Force, Coast Guard, or U.S. Military with a certificate of eligibility
- Officers of the National Oceanic and Atmospheric Association (NOAA)
- Members of the United States Military who have served 181 days continuously during peacetime or served 90 days during wartime
- Veterans who enlisted after September 7th, 1980, or who began service after October 16th, 1981 must have served a minimum of 2 years
- National Guards and reservists must have served a minimum of 6 years within certain criteria
- The surviving spouses of veterans who died from a service-related disability or during active duty
Manual Underwriting On VA Loans
FHA and VA loans are the only two loan programs that allow manual underwriting on home mortgages. Borrowers who cannot get an approve/eligible per automated underwriting system (AUS) and get a refer/eligible per AUS can get their files manually underwritten. Manual underwriting on FHA and VA loans is the same. However, manual underwriting on VA loans is much lenient than FHA loans. FHA and VA loans are the only two loan programs that allow borrowers in an active Chapter 13 Bankruptcy repayment plan to qualify for VA and/or FHA loans with trustee approval via manual underwriting.
VA Loan After Chapter 13 Bankruptcy Discharged Date
There is no waiting period after the Chapter 13 Bankruptcy discharged date to qualify for an FHA and/or VA loan. If the Chapter 13 Bankruptcy discharge has not been seasoned for at least two years, it needs to be manually underwritten. If you are looking to get qualified for a mortgage with a mortgage company licensed in multiple states with no lender overlays on government and/or conventional loans can contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at email@example.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays. Gustan Cho Associates are mortgage bankers, correspondent lenders, and have the ability to broker mortgage loans with the dozens of wholesale non-QM and alternative mortgage lenders.
November 5, 2021 - 5 min read