When looking at homes to buy, many members of our military community overlook the VA loan. Hopefully this short article will briefly give you the basics on who’s eligible and what to think about when considering a VA home loan.
VA Loan Eligibility
VA loans are open to veterans, active duty service members, reservists and members of the Public Health Service. The service member must be able to prove that they served in the military for 90 days during wartime and 181 days during a time of peace. He or she must have been honorably discharged. Veterans, active duty personnel, reservists and National Guard members can qualify. Also, some surviving spouses might be eligible for the VA loan.
With a lending counselor, the process is easy. The applicant must obtain a certificate of eligibility from the VA, which can be done quickly with the counselor.
The certificate verifies service and discharge. It also will determine how much the vet can borrow under the program.
Thinking About It
The VA loan is not for all service members. Although, not a great amount of emphasis is put on income, the average borrower of the VA loan tends to be middle class first time homebuyers with a salary of $50,000 or more. Qualified service members will not always be able to get the funds needed for a home in a place such as Palos Verdes due to limits placed on the loan. So, a good income to debt ratio and a higher salary are needed for basic living and mortgage expenses.
A military member will need to sit down with his or her family and discuss what could truly be financially doable in a place of high cost. When taking that into consideration, members can note that they can save money due to the no down payment and PMI. Plus, if they were to secure a loan for $417,000, the cost of a $900,000 home would be reduced to what is normally bought by middle class families. The most important thing to do would be to sit down with a VA counselor and set financial goals towards purchasing one’s dream home in a great location.
