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Purchasing a new home requires a lot of work. But, if you’re a veteran or on active military duty, the process can become even more challenging, especially if you’re not qualified for a traditional mortgage. This is where a VA loan enters the picture. It’s a type of home mortgage created by the U.S. Department of Veterans Affairs (VA) to help military people and their families obtain the necessary funds to buy a house.
Although the government usually backs VA loans, there are private lenders, like Security America Mortgage, that offer VA loans for those who need them. However, like conventional mortgages, VA loans are only available to certain qualified individuals.
Hence, if you’re planning to take out a VA loan, here’s how you can know if you’re eligible for this type of financial solution.
- Check The Qualification Requirements
One of the best ways to know if you’re eligible to apply for a VA loan is to check the basic qualification requirements. Typically, you may be qualified for the said loan if you’re one of the following:
- On Active Duty: If you’re actively serving in the military for a certain amount of time, you may be eligible to file a VA loan application. You need to show that you’re on active duty in the Navy, Air Force, Army, or Marines for at least 90 consecutive days.
- Veteran: If you’re a veteran, you may also qualify for a VA loan as long as you show a copy of your discharge papers in the military service.
- Reserve and National Guard: If you’re a member of the Reserve or National Guard, you may also be qualified to apply for a loan if you’ve completed at least six service years and are no longer actively serving for specified reasons. These can include placement in the retired list, honorable discharge from the service, and transfer to another part of the Reserve.
- Military Spouses: You may also be eligible for a VA loan if you’re a spouse of military personnel. But, specific requirements need to be complied with. For example, you must show that the military personnel you’re married to is deceased, a prisoner of war, or officially recognized as missing in action for at least 90 days.
So, if you’re one of the individuals mentioned above, you may have a better chance of getting a VA loan approval. But, if you want to prove your eligibility to your lender, you need certain paperwork showing the length and type of service you have. This paperwork is known as the Certificate of Eligibility. You can secure a copy of this document from the U.S Department of Veterans Affairs, or you can request assistance from your lender.
There are many lending institutions out there that not only provide affordable VA loans, but also quality customer service to all their clients. So, if you’re looking for a reliable lender, you may take a look at sites like securityamericamortgage.com.
- Know If Your Income Is Steady
To find out if you’re qualified for a VA loan, you need to determine if you have a steady income. Although there’s no specific income requirement to be eligible for the said loan, your lender will surely want to know if you can make the new mortgage repayments and pay your monthly costs.
Moreover, in some cases, your lender will also take a look at your residual income. It’s the amount of money left each month after deducting all the necessary expenses, including the mortgage payment. When you show you have residual income, you give your lender an assurance that you can cover emergency expenses without exhausting your savings. This situation may help you become more eligible for a VA loan to cover your home purchase.
Another way to know if you’re qualified for a VA loan is to check your credit score. Before you can get loan approval, the lender will review your credit score and see if you’re a risky borrower. Although the credit score requirements differ from lender to lender, most VA loan providers require a score of at least 620 for you to be eligible.
Hence, if you have a credit score lower than 620, the lender may be unable to offer you a loan. But, if your credit score is 620 or more, the lender may find you eligible for a VA loan. To make sure you’re qualified before taking out a loan, pull your credit history from the top credit bureau agencies to find out if you have a good enough credit score to obtain a VA loan approval.
Applying for a VA loan to help you purchase a new home doesn’t have to be challenging. As long as you know you’re eligible to do so, you can get the right mortgage you need. Therefore, if you’re planning to take out a VA loan anytime soon, keep the information mentioned above to know if you’ve met the eligibility requirements.