It’s hard to beat the feeling that comes with approving a VA loan. After all, veterans and active service members have given so much to our country, and it feels good to do a little to say thank you by helping them with their VA mortgage.
VA loans might seem like a simple concept, but there are many questions about what they are and who qualifies. Your best bet is to talk directly with someone at Goldwater who deals with them all the time. But as a quick primer, here’s how a VA mortgage loan works.
What Is A VA Home Loan?
A VA mortgage loan is a loan that is guaranteed by the U.S. Department of Veterans Affairs and is only available to those who have served in the military and their surviving spouses (more on qualifications in a moment).
Contrary to popular belief, the United States government is not the institution providing VA loans. It relies on traditional home lenders like the Frederick Branch of Goldwater bank to provide the loans. The loan is guaranteed by the U.S. Department of Veterans Affairs.
Who Is Eligible?
One of the most common questions we get about VA loans is “who is eligible?” While you should discuss your specific circumstances with a home loan lender, here is a general overview.
- Active Duty – After six months, most active duty are eligible for a VA mortgage.
- Retired or Honorably-Discharged – If you are a veteran who has retired or been honorably discharged, the VA loan might be a good option for you.
- Unremarried Surviving Spouses – As long as a spouse of a veteran does not remarry, she or he is eligible to take advantage of the benefits of a VA mortgage.
- Reservist and National Guard Members – VA Loan eligibility requirements have been amended over the years, and in 1992 reservists and National Guard Members became eligible. The caveat is that they have to have been a Reservists or National Guard Member for at least six years before being eligible. If they reach active duty, the basic 6-month waiting period of an active duty serviceman takes effect.
Why Does It Exist?
Loans for veterans began in 1944, during the middle of World War II. The original name of the VA loan says a lot: “Servicemen’s Readjustment Act.” The idea was to help those who had served in WWII return to society as seamlessly impossible. The ability to get home loans when they got back on American soil helped the veterans boost the economy of the entire country when they returned, and of course helped the veterans start the Baby Boomer generation in new homes.
How Are VA Loans Different From Other Home Loans?
VA loans are a government-guaranteed loan for those people mentioned above, which means they have a number of benefits.
- Lower Credit Scores – Although there is no official credit score for VA loans, the Frederick Branch of Goldwater Bank can work with scores as low as 560.
- No-Down-Payments – Not every serviceman has the means to save up for a home loan, and no-down-payment options can help them get into a home even sooner.
- No Mortgage Insurance – Mortgage insurance can add a substantial amount to a monthly payment, which means not having to have it can save quite a bit of money on a VA mortgage.
Again, we at Goldwater Banks are more than happy to speak with you regarding any questions you might have about loans for Veterans. We want to make the process as easy as possible, and that means finding the perfect loan for you. Read more here, and then contact us via the form at the right-hand side of every page.