VA loans have become more popular in the last few years. More people are drawn to them. Getting a VA Loan can be difficult if you don’t know what you are doing. The best bet is to get an agent who does know and spend your time finding a property that qualifies. Rather than a separate home, you can buy a condo.
Looking for a Condo
If you are looking for a VA condo and want to know which are approved, a VA approved condo list is available. To find it, you need to go to the VA website and find the page Requesting a Customized Condo Report. As usual, there is a form to be filled out and you will try to fill out each blank. The only blank that must be filled in is the state. You can get all the condos approved or you can get the ones whose approval is pending, too.
You want to find a condo that is accepted without conditions. The real estate agent you choose will first check to be sure the condos are approved and then write for a written guarantee. This may take a bit of time, up to 45 days. That is a long wait.
The four types of VA Loans
VA loans fall into four broad categories. Here is a quick look at the VA loan types to help you understand which one is ideal for you.
1. The Dreamweaver Home Purchase
With this program, someone negotiates the price for you, but you are in control and make any decision. The goal is to get you into a home for 0 down and 0 out-of-pocket expenses. You can use VA money to renovate the home. Remember, the VA doesn’t require a down payment, but that doesn’t mean someone else won’t. Watch for it.
2. 100 % Construction Loan
This loan is difficult to get because contractors don’t trust buyers. It allows for the purchase of the land and construction of either a fabricated home or a stick home.
3. Renovation Loan
This type of loan is rarely pushed. It allows for minor versus major renovations using VA money. The contractor receives his money from an escrow account.
4. Veterans Angel Program
This program is the most widely used. Sellers are hesitant to accept VA offers and it takes a veteran real estate agent who knows his stuff to get these loans at the best prices.
You need to meet certain criteria to be eligible for a VA loan. Below is a clearer picture of the major requirements for the same.
- You must serve 90 days of active duty during a war.
- You must serve 181 days of active service during peacetime.
- You must serve 6 years in The National Guard or Reserves.
- You should be the spouse of a veteran of the service who died in action or of disabilities that are related to the service.
You must also have a COE (Certificate of Eligibility) to start the process. Wait for it.
Benefits to VA Loans
One of the biggest benefits of the no down payment is not being required to pay mortgage insurance until 20% of the home equity has been reached. That is a big bonus. Next, VA loans have a lower interest rate. Calculate the interest rate over the length of the loan and compare it to an FHA or conventional loan. Compare to be sure.
The ability to buy a home or condo and repair it and make it habitable is covered by the VA loan. Those little repairs you intend to do in the future, do now.
There is no credit score requirement but scores of 620 or higher are best. Check your credit score for errors and fight for what you believe is right.
You should know in advance and accept that anything like getting a loan or buying a home or condo takes a lot of patience, time, and filling out forms. It takes dealing with people who make mistakes or have bad news to deliver. It takes time. Be patient.