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VA Loan Information
WHAT IS A VA-GUARANTEED LOAN?
These loans are made by a lender, such as a mortgage company, savings
and loan or bank. VA's guaranty on the loan protects the lender against
loss if the payments are not made, and is intended to encourage lenders
to offer veterans loans with more favorable terms. The amount of guaranty
on the loan depends on the loan amount and whether the veteran used some
entitlement previously. With the current maximum guaranty, a veteran who
hasn't previously used the benefit may be able to obtain a VA loan up to
$417,000 depending on the borrower's income level and the appraised value
of the property. The local VA office can provide more details on guaranty
and entitlement amounts.
WHAT CAN A VA LOAN BE USED FOR?
- To buy a home, including townhouse or condominium unit in a VA-approved project.
- To build a home.
- To simultaneously purchase and improve a home.
- To improve a home by installing energy-related features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/ caulking, storm windows/doors or other energy efficient improvements approved by the lender and VA. These features may be added with the purchase of an existing dwelling or by refinancing a home owned and occupied by the veteran. A loan can be increased up to $3,000 based on documented costs or up to $6,000 if the increase in the mortgage payment is offset by the expected reduction in utility costs. A refinancing loan may not exceed 90 percentof the appraised value plus the costs of the improvements. Check with a lender or VA for details.
- To refinance an existing home loan up to 90 percent of the VA-established reasonable value or to refinance an existing VA loan to reduce the interest rate.
- To buy a manufactured home and/or lot.
FREQUENTLY ASKED QUESTION # 16 [ -more VA Loan questions- ]
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Q: A One-Time Deal / What is the one-time exception for renewing VA eligibility?
A: A VA certificate of eligibility is renewable on a one-time basis. You qualify if the existing VA loan is paid in full, but you still own the property. Under the rules, you ordinarily must prove the property has been sold, but thanks to the one-time exception you may renew the VA certificate of eligibility. All you need to do is complete VA form 26-1880 and send it to the nearest VA Eligibility Center. Remember that getting released from liability for a VA loan or having a debt waived by the VA is not the same as paying off the loan. In that case you'll have to pay back the government's loss. Once that is done, the certificate of eligibility may be renewed.
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Remember, the VA does not make home loans. They insure the loans that we can assist you in getting.
Let us help you get a VA insured mortgage loan at the lowest possible rates.
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