The 6 Steps to a VA Loan Approval

For eligible US home buyers, the VA loan may be the best mortgage choice for a purchase.

Backed by the U.S. Department of Veterans Affairs and made possible by the GI Bill, the VA Loan allows no down payment, requires no mortgage insurance, and gives applicants access to flexible mortgage guidelines. Also, VA mortgage rates are often lower than other home loan products.

So how do you get a ? Here is a step by step guide of what you will need to do.

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1. Confirm your eligibility for a VA loan

Most US military veterans are eligible for a VA loan. But veterinarians are not the only ones who are qualified. Most active duty military personnel, National Guard and Reserve members, surviving spouses of deceased veterans, and others may also be eligible. A licensed VA lender can help you determine if you meet VA loan requirements.

2. Obtain a Certificate of Eligibility (COE) for a VA Loan

A COE is a simple document that proves to the lender that you qualify for a VA loan. Your lender can help you obtain this document through an online system that can tap into VA records to confirm your service. In most cases, a COE can be generated in seconds. All VA loans require a COE, except for the VA Interest Rate Reduction Refinance Loan (IRRRL), which reduces your interest rate by .

3. Get pre-qualified for a VA loan

The VA sets the rules and guidelines for VA loans. It does not set interest rates, points, or other loan closing costs. This is one reason why it can be a good idea to seek out the “best deal” – something the VA actually encourages. As part of prequalification, the lender will check or “pull” your credit history and may ask to see recent pay stubs, bank statements, and other basic financial documents. The more information you provide, the better your lender can explain your available loan options.

In addition, your lender can:

  • Help you compare different VA loan options that might meet your needs.
  • Tell yourself how much you can borrow with a VA loan and how much your monthly payment will be.
  • Help you complete a VA loan application.
  • Provide you with an authentic prequalification letter to help you buy the home you want.

At this point, it’s okay if you’re not ready to choose a lender. Banks provide VA pre-qualifications as a free service to buyers at no additional cost or obligation.

4. Find a house to buy

After getting your COE and pre-qualification letter, you will be ready to search for homes for sale with a REAL ESTATE AGENT. Your agent can help you find a home you like () based on the loan amount for which you have been prequalified. Remind your agent to include a VA loan contingency in your purchase agreement that will protect you in case you cannot close your loan.

5. Complete the VA loan process with your lender

Once you’ve found a home, your lender does most of the behind-the-scenes work to make sure your loan is approved and ready to go. You may be asked to provide additional financial documentation during this part of the purchase, and the lender will also arrange for a home appraisal to ensure you haven’t paid too much compared to the market.

For home purchases, the VA also recommends that you order a home inspection, so that you will be informed of the condition of the home and its major components, such as the roof, appliances, electrical wiring and plumbing. It may also be advisable to test the house for lead-based paint, radon and other substances.

Note that appraisals are not required for the VA IRRRL program, sometimes referred to as VA Streamline Refinance.

6. Closing Your VA Loan

When your mortgage loan approval is complete, you can sign your VA mortgage note and other loan documents during your “closing”. Closings often take place at a specially designated location known as a title company near your home or office. Sometimes they can happen at home – be sure to ask your lender if home closing is available for you.

At closing, you will receive information on where to send your monthly payments. Homebuyers will also receive new house keys from their seller.

Get started with your VA loan application

For VA-eligible buyers, mortgage approvals can be simple. There are fewer barriers in the VA loan program compared to comparable mortgage products. In addition, mortgage rates are often lower than the “market rates” of Freddie Mac, for example.

Find out how today’s VA loans can help you with your purchase or refinance. Mortgage rates are available online. It’s fast, it’s free, and your social security number isn’t required.

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The information contained on The Mortgage Reports website is provided for informational purposes only and does not constitute advertising for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent company or affiliates.