VA loans
What are VA Loans?
VA loans are loans backed by the Department of Veteran Affairs. These loans are offered exclusively to qualifying veterans and surviving spouses of veterans. VA loans are offered by private lenders and not by the Department of Veteran Affairs. VA home loans offer competitive interest rates and terms and can be used to purchase a single-family home, condominium, multi-unit property, manufactured house or new construction.
Benefits of VA Loans
Some of the benefits of VA loans are:
- 0% down payment for qualified veterans
- VA Loans typically have lower interest rates than other loan programs
- More flexible credit requirements
- No Private Mortgage Insurance
Qualifications for VA Loans
To be eligible for a VA loan, a borrower must have served:
- 90 consecutive days on active duty (wartime)
- 181 consecutive days on active duty
- (peacetime)
- 6 years in the Guard or Reserve, or 90 days under Title 32 orders (30 days must have been served consecutively)
Alternatively surviving spouses of veterans, spouses of veterans missing in action or spouses of veterans being held as a prisoner of war may also be eligible.
Additionally qualifying borrowers must also:
- Meet minimum credit requirements (The VA does not set a minimum requirement, but lenders typically do)
- Meet DTI requirement set by the lender
- Have a certain amount of income left over each month after paying their expenses. The excess residual income must be able to cover typical expenses for them and an dependent family members, such as: food, healthcare transportation, etc.