Deciding to buy a home is a big and important step! Whether it’s your first, second, third, or twenty-third time buying the process is exciting but can also be daunting and overwhelming. Odds are, if this is not your first rodeo, you likely know the steps to take to get started in the home-buying process. But if this is your first time or the first time in a while, you may need a breakdown of the process and steps to come.
Buying a home always has a process to follow and certain steps to take, but when you are taking advantage of VA loan benefits, you have a few extra hoops to jump through. The Department of Veterans Affairs has a few requirements you must meet and some extra paperwork to approve before you can receive the keys to your new home.
These policies are designed to ensure that you are getting your full amount of benefits and you are moving into a home that is suitable for you and your family. Therefore, it’s better to look at these steps as less of a hoop or burden and more as a stepping stone to lifelong ownership of a home that you love.
Follow along to learn more about how to start a VA home loan process until finished.
The first step in buying a home with a VA loan is ensuring that you are eligible for a VA loan. Before you find the right home, or even apply for preapproval, it is smart to familiarize yourself with the VA’s requirements. The most notable condition is that you must meet the military service requirement. This includes being on active duty, reserve, or retired from a branch of the military. Not every military servicemember is eligible though, as you must also meet a length of service requirement, which can differ depending on branch and type of service. Therefore, you should check the minimum with your specific service branch.
There are also unique circumstances that may qualify you such as discharges due to hardship, military disability, early out, and others. Additionally, surviving spouses of MIA, POW, or deceased veterans may qualify for a VA mortgage loan.
Apply for a COE
Once you are certain you meet the requirements for a VA loan, you can apply for your Certificate of Eligibility (COE). This certificate is official documentation from the Department of Veterans Affairs signifying you are eligible to receive a VA loan. To receive a COE, you must submit paperwork based on your service type this may include official forms, discharge papers, a statement of service with your identifying information from your commander, or retirement point information. You must mail all of the required paperwork to the VA or apply online. Compiling all the necessary paperwork can take time and effort but if you do not wish to do this yourself, you may be able to have your loan officer request your COE digitally. In either case, it can take up to 6 weeks for your COE to process, so plan accordingly.
Choose a Lender
Now that you know you can get a VA loan, you must find a lender who is willing to offer you one. Not all lenders are the same. Some are VA approved and can work with VA loans, while some are not. Even among VA-approved lenders, there are differences. For instance, lenders get to set their own policies for credit score requirements, interest rates, and loan closing costs. Therefore it is wise to shop around and find a lender that is best for you and your circumstances. For instance, if you have a low credit score or need a larger loan amount, it is best to work with a lender with flexible offers and rates.
When you are ready to start shopping for a home, it is best to have a pre-approval in hand. This is a letter stating that you are already preapproved for a loan of a certain amount with a lender. Showing this letter to your real estate agent and the agent for home sellers indicates that you are a serious buyer and able to make an offer. Some homeowners will not even entertain an offer from a buyer if they do not already have preapproval, as waiting on lender approval can slow a sale or even cause a sale to fall through.
Find a Home
Now for the fun part! Once you have met the requirements and have preapproval in hand, you can begin looking for your dream home! While some find this process overwhelming, it can also be fun and exciting to go to home showings and envision your family living in a new home. It is wise to work with a real estate agent who understands your price range, wants, needs, and deal breakers and is willing to work to find you homes that meet all the items on your list of requirements. It may take months to find the perfect home for you, or you could possibly fall in love with the first home to step foot into. It’s best to remain positive and hopeful!
Make an Offer
Once you have found your dream home, it is time to put your real estate agent to work. They should help you compile all the necessary paperwork and draft an offer letter to submit to homeowners. They will also help you negotiate contingencies such as what is included with the sale, who is covering closing costs, and how much time you have to secure funding and appraisals. It is also important to note that your real estate agent should understand VA circumstances including how to implement a VA option clause, should the sale fall through. Once you have signed a purchase agreement, the only thing standing in your way is an appraisal.
All home sales must undergo an appraisal so the lender can ensure that the home is worth the amount they are loaning for the home. A home with a VA loan purchase must undergo a VA appraisal which has some minimum property requirements that are stricter than a typical standard appraisal. This requirement ensures that military families are moving into a home that is reasonably safe and a good investment. Some of these strict requirements include that all mechanical systems are in working order, the roof is not in disrepair, there is no presence of termites or mold and more. This appraisal ensures that you are buying a home that is move-in ready.
Closing the VA Home Loan Process
Once you have followed each of the steps mentioned, and your desired home has passed the VA appraisal, you need only to make your payments, sign on the dotted lines, and receive the keys to your brand-new home.
You deserve to live in a home that you love and as a thank you in return for your service, you deserve to have the home-buying process run affordably, smoothly, and efficiently.
Our team at Desert Heroes understands military families because we come from military families. We are well-versed in military lingo and requirements and are extremely familiar with the steps to buying a home with a VA loan.
Call us today to start the VA Home Loan process.