In order for you to get a VA loan, you must qualify for the following VA loan requirements.
– First and foremost, you must be an eligible veteran. You need to have a home loan entitlement. The exception to this case is if the interest rate is reduced on the refinancing loan. Also, the loan must have an eligible reason behind it.
– You must also occupy the house at a reasonable period of time. The loan can only be closed if you have lived in the property during that tenure. You must also have enough income to make the mortgage payments on the loan that you are applying for. If you intend to save the money to support your family, you will be able to do so because you get to save if you have a VA loan.
– Most importantly, you need to have a good credit record. If not, you will have a hard time getting the VA loan application that you are applying for. From the looks of it, a good credit score is the most important VA loan requirement that has to be met.
Once you meet the VA loan requirements, you already qualify for a VA guaranteed loan. These are made by private lenders like loan and savings associations, mortgage companies and banks. In order to get a loan, you have to look for a lender.
The VA loan requirements will be checked yet again for the loan to be approved. Once the loan is closed then you are guaranteed that the lender will protect your property against any loss. However, the possibility of you or a future owner may not be able to repay the loan but the consequences of this situation are stated in the guaranty.
Generally, the cost of the guaranty depends on the qualification and how you were able to meet the VA loan requirements. Normally, this will cost up to 25 percent of the total cost of the home loan. This is also subjected to the entitlement of the veteran.
If the loan cost more than this, then the purchase of construction must be made. If the home is a condominium, the rules are different as that of a privately owned residential unit. The guaranty varies from one VA guaranteed loan to the next.
There is also the discussion of the interest rate reduction which is also determined by the qualification of the VA loan requirements. The maximum guaranty is 25 percent of the total cost.
Remember that the maximum VA loan is determined by the lender. Most VA loan requirements are easily met by those with good credit score. If you already have that, then you can make the most out of the benefits from the VA loan that you are applying for.
If you opt for VA loans that are sold in secondary markets, you will not get as much benefit as those that you get from the lenders mentioned in a previous paragraph.