The home loan program was established by the U.S. Government as one of many ways for the country to regain its economic strength following the sacrifices military families made after WWII. By making interest rates affordable, removing the expense of certain fees and eliminating the requirement for a down payment, many were able to afford homes that may not have been able to otherwise. Today, the same programs are still available, but not all veterans take advantage of them. Some may feel they will not qualify, or have other concerns about their readiness. Here are some tips to help those who are debating whether or not this option is the right for them.
Choosing the Location
People often worry that despite being happy with where they are living now, they may want to move in the future. That is a common concern for everyone, not just military members. The average American moves approximately once every five years. Since veterans are eligible to apply for a VA loan whenever they are purchasing a primary home, it is possible to purchase and sell a home and then buy again when resettling somewhere else.
Not Financially Prepared
Families who are able to afford rent along with their other living expenses are usually able to afford paying for a home. If the worry is about paying for a mortgage while also having to fix up a property, it is important to realize that VA loans allow borrowers to receive enough funding to perform necessary repairs to fix up the property being purchased. The lender can help their clients find homes that are still within their budget, even factoring in the additional amount for repairs.
Savings too Small
The cost of the home will determine how much is needed for closing costs, but since many borrowers are able to get a loan with no money down, these fees are much less than what many may expect. The average home buyer using a VA loan will pay three percent or less of the purchase price for the total closing costs.
Credit is Poor
The VA does not require a veteran have a certain credit rating in order to qualify, but the individual lender will often consider the credit score as one of the factors that help them determine whether or not to approve the loan. Most will prefer that the borrower has a score of at least 620. There are many ways worried home buyers can quickly improve their score before they apply.
After Filing Bankruptcy
Do not let a previous bankruptcy be the reason for not looking at homes. This type of financial circumstance will not prevent a veteran from receiving a VA loan approval. As long as the veteran has worked towards improving their situation, it is possible to be approved as soon as two years after filing.
It is possible to apply for a VA loan and get a free VA loan quote online. This service makes it simple to see whether or not the applicant qualifies and how much home they will be able to afford. A complete list of requirements is available from the Veteran's Department, but the government does not actually provide the loans. For this, all borrowers need to find an approved lender in order to apply. Consider looking into local lenders to get a free VA loan quote.