For a lot of Veterans, active duty and retired, understanding how to use the VA Home Loan benefit to buy a home has been somewhat of a challenge, an enigma of sorts. Until recently, buying a home using a VA Home Loan was a slow and tedious process. It is, after all, a government program and that means a lot of forms need to be completed. Not only that, but once those forms have been filled out, verified, mailed, and reviewed, the process would need to be repeated back to the lender once it received approval. There’s no doubt that the process took a while so it’s no surprise that eager Real Estate Agents encouraged their clients selling the home, to use more conventional loan types, steering them away from buyers using their VA Home Loan benefit.
A lot has changed since those early days. With advancements in technology and the ability to access, send, and receive information electronically, the speed in processing paperwork for the VA Home Loan is on par with other types of home loans available on the market. At Aligned Mortgage we are often asked, ‘How long does it take a VA Loan to close? It has always been our mission to diligently serve our clients and we have mastered the process to get our clients through the loan procedure and into their new home within a 30-day window, of course not all transactions are the same. If you’ve been told by other lenders that it takes an average of 45 days (or longer), it might be time to look for a new lender, one that is dedicated to working hard for our veterans to get them into their new homes as quickly as possible.
How Do I Use My VA Loan Benefit to Buy a House?
The best place to start when thinking of buying a home with the VA Home Loan Benefit, is to find out if you are eligible by obtaining your Certificate of Eligibility. This can be done through the eBenefits portal online, or with your Aligned Mortgage Loan Officer. Once you’ve taken care of that, the next step is to review your current finances and see how financially fit you are. A few of the things your Loan Officer will need to look at are your credit profile, your monthly income, your current expenses and your monthly budget. If you have any areas you need to improve, you’ll want to take care of those things prior to starting your loan process. Reviewing your credit profile annually is a great way to stay on top of your credit score, which can help you secure better interest rates when it comes to financing your new home. Most lenders have their own system, or ‘overlay’, to determine what is an acceptable credit score. At Aligned Mortgage, we understand the challenges that our military veterans face building up their FICO score and that ‘life happens’. If you’ve been told no in the past due to a low credit rating, give one of our Loan Officers a call and find out what’s possible. We can work with you to determine how much house you can afford.
We Are Excited To Get You Started!
Choose A VA-approved Lender
Choosing a lender is the next step in the process. A ‘lender’ can be a private bank, credit union, or a mortgage company like Aligned Mortgage, and each individual lender offers different loan rates. The Department of Veterans Affairs allows each lender to charge lender fees, also known as loan origination fees, which are typically 1% of the loan. These fees are used to get the process going, are paid by the borrower, and may vary by lender. In addition to the lender’s origination fees, there are also closing costs, associated with the loan that are paid during closing, or the final stage of the loan. The VA requires a Funding Fee on VA mortgages, which is based on the type of loan, the amount of the loan, and your military category (as well as other factors). This is a one-time fee that all veterans must pay to help reduce the loan’s cost to the taxpayers, unless: they are receiving VA compensation for a service-connected disability; or are eligible to receive those benefits but are receiving active duty or retired pay instead; or are the surviving spouse of a Veteran who died in service or from a service-connected disability. The Funding Fee can be rolled into your loan (financed) or you can pay the full fee out of pocket at closing.
Finding Your Realtor, Finding Your Home Using The VA Home Loan Benefit
If you’re ready to start looking at the local real estate market, you’ll want to choose a Realtor that you’re compatible with and trust. Start by asking your family, friends or co-workers if they know an Agent they can refer you to, preferably someone that knows how to use the VA Home Loan to buy a home. After you find a Realtor, it’s time to look at houses that are in your price range. Compare the different homes and surrounding areas to see if it’s a good fit for you and your family. Test out the commute during peak traffic times, research the local schools and neighborhood parks. If you’ve already found a home and need a Realtor, give one of our Aligned Mortgage Loan Officers a call and they can connect you with a local Agent that understands the process, knows how to use the VA Loan and understands how long it will take a VA Loan to close. Together we can work to get you into your new home before your next BAH payment goes back to the privatized housing venture.
Would You Like to Learn More About the VA Home Loan Benefit?
Aligned Mortgage offers a FREE VA Home Loan Benefit Seminar every month, explaining the power of the VA benefit. Come join Hawaii’s #1 VA Lender and learn how to use your BAH to build your legacy.
Sign Up For A Free VA Home Loan Seminar
Attend one of our free VA Home Loan Seminars and learn how to build your legacy with home equity from our VA Loan Experts and US Navy Veteran Chris Cano, and Marine Veteran Tony Dias.