What is a VA Loan?
A VA loan is a mortgage loan in the United States guaranteed by the United States Department of Veterans Affairs (VA). The program is for American veterans, military members currently serving in the U.S. military, reservists and select surviving spouses (provided they do not remarry) and can be used to purchase single-family homes, condominiums, multi-unit properties, manufactured homes and new construction. The VA does not originate loans, but sets the rules for who may qualify, issues minimum guidelines and requirements under which mortgages may be offered and financially guarantees loans that qualify under the program.
VA Loan Eligibility
Most members of the regular military, veterans, reservists and National Guard are eligible to apply for a VA loan. Spouses of military members who died while on active duty or as a result of a service-connected disability also can apply.
Active-duty military personnel generally qualify after about six months of service. Reservists and members of the National Guard must wait six years to apply, but if they are called to active duty before that, they gain eligibility after 181 days of service.
Certificate of Eligibility
The VA determines your eligibility and, if you are qualified, the VA will issue you a Certificate of Eligibility to be used in applying for a VA loan. This form will provide the information about how much your home loan benefit is, and should also indicate if you are eligible for a funding fee waiver. You may be able to obtain your COE electronically through the VA. If that doesn’t work, you’ll need to fill out a specific form and email or fax it to your regional VA office to have it completed. Command Financial can assist with this process. Often these can instantly be pulled electronically through the VA portal. If not we can request a copy on your behalf with a copy of your DD-214.
Speak with a Veteran
CFG is owned and operated by Proud Veterans, military family members and supporters of our Great Armed Forces. We have extensive experience with the VA loan process and are here to support you every step of the way.
Frequently Asked Questions
Most frequent questions and answers
Where can I get a VA loan through CFG?
We’re happy to answer questions or provide recommendations nation-wide, but can only provide full assistance or secure VA loans currently in Illinois, Colorado & Michigan.
Do VA loans require PMI?
A VA loan doesn’t require private mortgage insurance.
Can existing VA borrowers lower their interest rates?
The Interest Rate Reduction Refinance Loan (IRRRL) gives existing VA loan holders the opportunity to lower their interest rate. This option requires borrowers to refinance their current VA loan into another VA loan.
The advantage to an IRRRL is that income underwriting is not required. Additionally, you don’t have to pay cash out of pocket. An IRRRL is structured so than any fees are rolled into the new loan or the interest is adjusted so that the borrower’s costs are covered. A VA appraisal and pest inspection is not required.
What are VA loan funding fees?
Although the costs of getting a VA loan are generally lower than other types of low-down-payment mortgages, they still carry a one-time funding fee that varies, depending on the amount of the down payment and military category. This fee helps to fund the VA program. VA funding fees are required on all loans unless the veteran is exempt from paying the fee. A VA disability rating of 10% or more will allow for exemption from the funding fee. Your COE is used to verify the exemption.
Are there VA home loan occupancy requirements?
VA loans typically require borrowers to move into their home within 60 days of purchase and to use it as their primary residence. However, exceptions can be made depending on the circumstances.
Borrowers can’t use VA loans to buy investment properties or second homes.However, it is possible to have more than 1 VA home loan at the same time.
1-4 unit properties are eligible for VA financing so long as 1 unit is owner occupied.
What are VA loan underwriting requirements?
The VA doesn’t require a minimum credit score for a VA loan, but lenders generally have their own internal requirements. CFG is able to get financing for qualified borrowers with scores as low as 500.
Help for struggling VA borrowers
Another advantage of a VA loan is the assistance offered to struggling borrowers. If the borrower of a VA loan can’t make payments on the mortgage, the VA can negotiate with the lender on behalf of the borrower.