Here are some frequently asked questions on VA Home Loans and how you can become a mortgage lender to assist veterans and active-duty service members find their dream homes.
What is a VA loan?
A VA Loan is a home loan that is provided by private lenders like a mortgage company or a bank and backed by the U.S. Department of Veterans Affairs (VA). The VA does not actually lend the money for the loan; instead, it guarantees a portion of the loan, which protects the lender from a loss if the borrower defaults on the loan.
The key benefits of a VA Loan are that they can offer qualified borrowers 100% financing with no down payment required, and they have lower average interest rates than other types of home loans.
The VA provides a variety of loans to make owning a home easier for Veterans:
- Purchase Loans often do not require a down payment and allow Veterans to buy homes at competitive interest rates.
- Native American Direct Loan Program (NADL) is used to help Native American Veterans afford home buying activities on Federal Trust Land. It can also lower the interest rate on a VA loan.
- Interest Rate Reduction Refinance Loans (IRRRL) can lower interest rates by refinancing current VA loans.
- Adapted Housing Grants are available to Veterans with permanent service-related disabilities. These grants allow Veterans to purchase, modify, or build an adapted home to accommodate their disabilities.
How do I apply for a VA loan?
For most VA loans, you will first need to complete a Certificate of Eligibility (COE). This certificate can be found online through “eBenefits”, delivered by mail, and through your bank or mortgage company. Your lender will help you apply for other loans you qualify for, assisting you through VA forms and submitting them to the nearest Regional Loan Center.
Am I qualified for a VA loan?
Generally, active-duty military personnel, veterans, reservists, and National Guard members are eligible for a VA Loan. In some cases, spouses of service members who have died in the line of duty may also be eligible for a VA Loan.
Eligibility requirements for VA loans depend on Veterans’ service commitment or length of service, duty status, and character of service. For a purchase loan or cash-out refinance loan, qualified Veterans must have a certain level of credit, a sufficient level of income to meet monthly payments, and a valid Certificate of Eligibility (COE).
There are a few things that the VA will consider when determining your eligibility for a loan. These include:
- Your character of discharge from military service
- The amount of time you have served
- Your credit score and history
- Your current debt situation
- Your current income and employment status
- Your documentation of any dependents
What are the requirements for a VA Loan?
The main requirement for a VA Loan is that the borrower must have satisfactory credit. In addition, the borrower must have a certificate of eligibility from the VA, which can be obtained through most lenders that offer VA Loans.
What is the interest rate on a VA Loan?
The interest rate on a VA Loan is determined by the market, but it is usually lower than the interest rate on a conventional loan.
What are the fees associated with a VA loan?
There are no origination fees or prepayment penalties associated with VA Loans. However, there is a funding fee, which is a one-time fee that is paid at closing. The funding fee ranges from 1.25% to 3.3% of the loan amount and is based on the type of service member, whether it is the borrower’s first time using a VA Loan, and whether the loan is being used to purchase a primary residence or investment property.
Do military veterans qualify for other benefits?
Yes, the VA provides a variety of benefits and services to Veterans. In addition to a VA loan, Veterans may also qualify for other benefits such as the GI Bill, which can help with education and housing costs. Veterans may also be eligible for health care and life insurance through the VA. To learn more about these and other benefits, visit the VA website or speak with a VA representative.
What else do I need to know about VA loans?
There are a few things you should know before you apply for a VA loan. First, there is no minimum credit score required to qualify for a VA loan. However, your credit score will affect the interest rate you receive. Second, you do not need to be a first-time homebuyer to qualify for a VA loan. You can use your VA loan benefits multiple times as long as you sell the previous property before buying another one. Lastly, there is no down payment required for a VA loan. You may choose to make a down payment, which can lower your monthly payments and interest rate, but it is not required.
Become a Mortgage Lender for VA Loans with Capstone Institute
If you’re interested in helping Veterans receive VA loans, you can become a mortgage lender in Atlanta through industry-leading mortgage training courses with Capstone Institute. Loan origination training courses and mortgage loan processing classes are available online and in person at Capstone Institute in Atlanta. Capstone Institute is recognized statewide for providing high-quality, comprehensive mortgage lending education.
After completing the necessary training, you will be able to assist Veterans in the VA loan process and connect them with available benefits. Join the 65,000 individuals that have completed loan courses with Capstone Institute and are helping Veterans and other US citizens obtain their dream homes. Call today for more information at 888-254-3431.