A VA home loan is a great benefit to military personnel during and after their service. McMullen Group understands the importance of a “home base” for military and their families and is proud to be able to help active and retired military use this product to meet their unique needs.
VA home loans are partly guaranteed (typically a quarter of loan value) by the U.S. Department of Veterans Affairs and offers the following advantages:
To obtain a VA home loan, an applicant must obtain a Certificate of Eligibility.
|Chart 1: COE eligibility requirements|
|Qualifying Event||Active Duty||Veteran|
|Any||Gulf War||24-month rule||Post-Vietnam||Vietnam|
|Active Duty Dates||Any||8/2/1990 – Present||9/8/1980 - 8/1/1990*||5/8/1975 - 9/7/1980**||8/5/1964 - 5/7/1975***|
|Post-Korea||Korean War||Post-WWII||WWII||Nat. Guard & Res. (Gulf War)|
|Active Duty Dates||2/1/1955 - 8/4/1964||6/27/1950 - 1/31/1955||7/26/1947 - 6/26/1950||9/16/1940 - 7/25/1947||8/2/1990 – Present|
|Active Duty Service||181 cont. days||90 total days||181 cont. days||90 total days||90 days active service|
|Spouse of a veteran|
|National Guard and Reserve|
Six years of service in the Selected Reserve or National Guard, and
1) Honorable discharge; (2) Placed on the retired list; (3) Transfer to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after honorable service, or (4) Continued service in the Selected Reserve
|*Officer start date: 10/17/1981 **Officer end date: 10/16/1981 *** Start date for service in the Republic of Vietnam: 2/28/1961****A surviving spouse remarried before 12/6/03 and reaching age 57, must have applied by 12/15/04 for eligibility.|
Once certified, an applicant can apply to use the guaranty on these financing and refinancing opportunities:
Qualified service members are those that have received a discharge other than dishonorable from an eligible branch of the service, including the U.S. Army, Navy, Air Force, Marines, Coast Guard, Nat. Guard and Reserve and US. Military academies. They also meet the service requirements charted below.
A 30-year fixed rate option gives you a stable, predictable monthly payment. These loans are great for people settling down in one house over a long period of time. They give deployed soldiers a warm place to come home.
A 15-year fixed-rate option could help current service members who would like to build equity more quickly. You pay more monthly, but this pace builds more equity in your home.
The flexibility of an adjustable rate mortgage can be appealing to current military service members expecting to move in the next few years. ARM homeowners pay a low introductory interest rate for the first few years, then move or refinance before it adjusts upward.
The VA will guarantee a maximum of 25% on your home loan up to the conforming loan limit of $484,350. For a loan greater than that amount a VA Jumbo Loan is needed. With a VA Jumbo Loan you can apply for a home up to $1,000,000 and will only need a down payment of 25% on the difference between $453,100 and the asking price of the home.
For example, you want to purchase a home that costs $500,000. You would be required to pay 25% down on the amount over $453,100.
$500,000 - $484,350 = $15,650. Then $15,650 x 25% = $3,912.50. This would be your down payment. This payment is still considerably lower than the 10% traditionally required for jumbo loans.
A cash-out refinance helps you handle big-ticket items – college, health expenses or debt, for example. Effectively, you pay off the remaining balance and take out a new loan for the appraised value of the house. Much of the difference goes into your pocket as cash.
An Interest Rate Reduction Refinance Loan (IRRRL) helps service members refinance at a lower interest rate. Refinancing can help lower your monthly payment, change your term or turn an ARM into a fixed rate. Other advantages include:
If you are looking for a VA home loan, then McMullen Group can help you. To learn more, please contact a PrimeLending home loan expert near you.