Information about VA loans are often misconstrued especially by first-time homebuyers
. Loans are guaranteed to veterans that meet specific qualification set forth by the Veterans Administration, however the VA never operates in the capacity of a lending agent. Check with a credit counselor and obtain your credit rating before you apply for every type of loan. Thus, applying for that guaranty will bring no surprises.
The VA charges a obligatory funding fee for those veterans that are purchasing homes for the first time. The veteran is adding to the price of his mortgage and taking the burden off the taxpayer and that is the reason the fee is compulsory. First-time homeowners pay a little over two percent for a "no money down" loan while the fee for a second-time owner is greater at three percent. The reason for the higher fee for second-time buyer concerns presumed equity in the property and/or time to save for the extra cost. Refinance mortgage loans from the VA always follow the same percentage schedules.
Some people are lucky enough to be exempt from the funding fee, but not so fortunate as they must suffer from a disability from a military injury and be getting compensation for that injury in order to qualify for the exemption. Other officially permitted exemptions go to surviving spouses of veterans who passed away in the service of their nation or from military disability difficulties. The VA decides each case on its own merit and always has the last say on exemptions.
VA loans are amazingly versatile. It can be used for home upgrades as well as for the purchase of a new property and also for the use of updating your energy efficiency. It is certainly a great idea to ask about the restrictions and allowances each VA loan can offer.
An essential aspect of determining eligibility for a VA loan concerns the conditions in which the veteran was let go from military service. Obtaining a VA mortgage loan becomes more difficult when a discharge other than "honorable" is involved. A neighborhood VA organization can assist veterans who might have had other than an "honorable" discharge with filling out the correct forms, finding out where to send them and knowing how to appeal a decision, if required.
Confirmaiton of an updated discharge or an error regarding the nature of the primary discharge need to be provided at the time of the mortgage loan application as well as a few copies of the DD214 form. A home loan guaranty will not be given to any applicant who is unable to uphold monthly house payments.