The loans were created in order to assist individuals who might not have otherwise been able to obtain a mortgage due to their financial situation or any other type of economic woes they’re facing. The Federal Savings Bank, which specializes in veteran loans says they are available to eligible candidates who are either currently active in the armed forces, veterans or spouses of veterans.
Since most borrowers and first-time homebuyers don’t need large down payments, they will be able to avoid insurance premiums, penalty fees as well as high interest rates. In fact, some qualified applicants won’t even have to put any money down on the home, and can obtain 100 percent financing.
“In many cases, it is easier to get a VA loan with a less-than-favorable credit score than a bank loan,” Leung wrote. “In fact, Veterans Affairs does not require a minimum credit score, although lenders may have their own internal requirements. Unfortunately, many applicants do not take advantage of the VA loan system because they are not sure if they qualify or don’t know how to start the process.”
She added that most military members, veterans, reservists and National Guard members are eligible for VA loans as well, and those who are interested should explore their options.
According to the VA Home Loan Center, those who served in the National Guard or in the Reserves have a minimum six year duty requirement before they are able to obtain a loan. If they were discharged due to an injury, there is potential that they can still be considered for loan options.
Retired service members
In order for retired veterans to qualify for a loan, they will have had to serve at least 181 days or 90 days during the Gulf War and must have an honorable discharge from the service. If the individual served less than 90 days, they could potentially be considered for a loan if they were discharged due to a service-related disability.
If an individual is a surviving spouse who remarries after the age of 57 and on or after December 16, 2003, they will be considered for a VA home loan. Other factors that would make someone qualified for obtaining a loan is if they are a spouse of a veteran who died in the service or from a service-related disability who has not remarried yet. In addition, spouses of missing soldiers or prisoners of war qualify for acquiring these loans.
The process of obtaining a VA loan is fairly simple, however there are a few things veterans should know first before beginning the process.
“What is the VA looking for in veterans applying for a loan? First, they’re looking for a good credit score,” the VA Home Loan Center website stated. “It doesn’t have to be ‘great’ – just good. They’ll be looking in particular at the last 12 months to be sure you’ve made your payments on time. And some lenders require a minimum credit score, which varies by lender. They’ll also want to make sure you can pay your mortgage, and also have enough income to pay your other bills as well. Depending on your family size and your location, they will determine your minimum requirements for loan approval.” For more information regarding VA home loans visit: TheFederalSavingsBank.com
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